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The AUD/USD pair drifts lower during the Asian session on Thursday and erodes a part of the previous day's strong gains to its highest level since September 17. Spot prices stick to modest losses following the release of mixed Australian employment details and currently trade just above mid-0.6600s, though the downside potential seems limited.

The Australian Bureau of Statistics (ABS) reported that the Unemployment Rate held steady at 4.3% in November compared to the consensus estimate for an uptick to 4.4%. This, however, was offset by a fall in the number of employed people, by 21.3K during the reported month, down from 41.1K in October (revised from 42.2K) and missing the forecast of 20K. This, in turn, undermines the Australian Dollar (AUD) and turns out to be a key factor exerting some pressure on the AUD/USD pair.

That said, the Reserve Bank of Australia's (RBA) hawkish stance might hold back the AUD bears from placing aggressive bets and help limit losses for the currency pair. In fact, RBA Governor Michele Bullock, following the widely expected on-hold rate decision earlier this week, said that the Board discussed what they might have to do if rates need to go up and that it looks like more rate cuts are not needed. This could support the AUD/USD pair amid a bearish US Dollar (USD).

The USD Index (DXY), which tracks the Greenback against a basket of currencies, languishes near its lowest level since October 21 in the wake of the US Federal Reserve's (Fed) dovish cut on Wednesday. In a widely expected move, the US central bank lowered borrowing costs by 25 basis points and projected just one more cut in 2026. Traders, however, remained hopeful about further cuts ahead in the wake of Fed Chair Jerome Powell's remarks at the post-meeting press conference.

Powell said that the US labor market has significant downside risks and the Fed does not want its policy to push down on job creation. Investors were quick to react and are now pricing in two more rate cuts in 2026. This, along with the upbeat market mood, continues to undermine the safe-haven Greenback and should contribute to limiting losses for the perceived riskier Aussie. Hence, any further corrective slide might still be seen as a buying opportunity and remain limited.

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