Dollar gains overnight

chart, arrow, dollar, up, graphThe Australian dollar has rebounded, gaining more than one US cent overnight following the release of disappointing US retail sales and jobs figures.

At 0700 AEDT on Friday, the local currency was trading at 77.53 US cents, up from 76.51 cents on Thursday.

US retail sales fell for the second straight month in January, pulled lower by falling petrol prices, official figures showed.

Meanwhile, new claims for unemployment insurance jumped last week to back above the 300,000 line, the Labor Department said.

The disappointing figures weakened the US dollar, giving the Australian dollar a boost following its sharp fall on Thursday.

The local currency slipped to near six year lows after surprisingly weak jobs figures showed Australia’s unemployment rate rose to 6.4 per cent in January – its highest level in more than a decade.

“It was the January US retail sales report that shook markets up,” National Australia Bank senior economist, David de Garis, said.

“Once again, the report disappointed expectations, leading to a decline in the US dollar.

“After being unceremoniously dumped yesterday after the spike higher in Australia’s unemployment rate, the Australian dollar/US dollar has recovered its poise overnight, aided by US dollar selling.”

All eyes on Friday will be on Reserve Bank governor Glenn Stevens who is due to appear before the House of Representatives Economics Committee.



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