The Australian dollar strengthened versus its U.S. counterpart after jobs growth in July topped forecasts and fueled hopes that the Reserve Bank of Australia would not rush to ease interest rates further.

The number of employed persons rose by 41,100 in July, compared with only 500 added jobs in June, according to data from the Australian Bureau of Statistics. The Trading Economics consensus estimate was for a gain of 14,000.

The seasonally adjusted unemployment rate held steady at 5.2% for the fourth month in a row, in line with estimates.

The Australian dollar traded 0.52% higher versus the U.S. currency as of 1:09 p.m. Canberra time.

"The strong rise in employment in July suggests the RBA won't be in a rush to ease policy further, but we think it won't be long before the unemployment rate starts to rise again," said Marcel Thieliant, senior Australia & New Zealand economist at Capital Economics.

Policymakers are likely to remain in "wait and see mode" and leave rates unchanged in September, Thieliant added. But given that the unemployment rate exceeded the RBA's new estimate of the natural rate of 4.5%, the Australian labor market will have to tighten much further for wage growth to spur inflation toward the central bank's 2% to 3% target, Thieliant said, adding that the RBA is likely to slash rates to 0.5% by early 2020.

Last week, the central bank reiterated its willingness to ease policy further to curb unemployment and bring inflation closer to its target as it left the cash rate at a record low of 1.00%.