Daily Morning Report 16.02.2017

The Australian and New Zealand dollars edged lower against their U.S. counterpart on Thursday, despite strong Australian jobs data, as expectations for a U.S. rate hike as soon as next month continue to support the greenback.

AUD/USD slipped 0.13% to 0.7699, off a three-month high of 0.7732 hit overnight.

The Australian Bureau of Statistics earlier reported that the number of employed people increased by 13,500 in January, beating expectations for a 10,000 rise. The number of employed people climbed by 16,300 in December, whose figure was revised from a previously estimated 13,500 gain.

The report also showed that Australia’s unemployment rate ticked down to 5.7% last month from 5.8% in December. Analysts had expected an unchanged reading in January.

NZD/USD eased 0.08% to trade at 0.7219, after hitting a one-week high of 0.7243 overnight.

The greenback remained broadly supported after Federal Reserve Chair Janet Yellen told the U.S. Senate Banking Committee on Tuesday that the central bank will likely need to raise interest rates at one of its upcoming meetings.

Ms. Yellen said that waiting too long to raise interest rates would be “unwise,” given the rise in inflation and economic growth.

At her second day of economic testimony before Congress on Wednesday, she offered no addition information on the timing of the central bank’s next rate hike.

The U.S. dollar was also underpinned by strong U.S. inflation and retail sales data released on Wednesday, which boosted optimism over the strength of the economy and added to expectations for a near-term rate hike.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.09% at 101.00, just the previous session’s five-week high of 101.75.