FX.co ★ Australian Dollar Rises from Multi-Month Lows

The Australian dollar climbed toward $0.70, rebounding from multi‑month lows as markets digested fresh commentary from the central bank. Reserve Bank of Australia Assistant Governor Christopher Kent acknowledged signs that the labor market is cooling faster than anticipated, but warned against placing too much weight on a single month’s data.

Unemployment unexpectedly rose to 4.7% in September, the highest level in five years, leading markets to pare back expectations for another interest rate increase. Kent also pointed to evidence that neutral interest rates are moving higher both in Australia and globally. He maintained that monetary policy is still somewhat restrictive, while raising the question of whether it is restrictive enough.

At the same time, after posting a modest weekly loss, the Australian dollar recovered some ground against the US dollar. The move followed comments from Federal Reserve officials suggesting no immediate pressure to tighten policy. Fed Chair Kevin Warsh said at an IMF event that he does not “prejudge” policy decisions ahead of the October 27–28 meeting.