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Aussie falls after poor jobs data, BoJ review ahead

3/16/2017, 9:49:56 AMMarket Analysis
Aussie falls after poor jobs data, BoJ review ahead

The Aussie fell in Asia on Thursday after disappointing jobs data and after the Fed as expected hiked interest rates with the Bank of Japan policy review ahead.

The BoJ will release its latest policy views around noon Japan time.

In Australia, employment change figures for February showed a drop of 6,400, missing an expected gain of 16,000, with the unemployment rate ticking up to 5.9% from 5.7%.

USD/JPY changed hands at 113.28, down 0.10%, while AUD/USD traded at 0.7696, down 0.18%. GBP/USD traded at 1.2285, down 0.06%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.05% to 100.31.

The market also noted a widely expected fed rate hike of 0.25% on Wednesday by the Federal Reserve Open Market Committee (FOMC), which marked the highest Fed Funds rate since October 2008, with up to three increases seen this year.

"The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data," the latest statement said.

Overnight, the dollar nosedived more than 1%, after the Federal Reserve increased interest rates by 0.25% a 0.75-1% range.

The greenback added to losses and last traded at 100.47 down 1.13%, after Fed Chair Janet Yellen fielded a raft of questions concerning the Fed’s decision to raise rates; future monetary policy decisions and the current as well as future prospects of the U.S. economy.

Yellen struck a somewhat dovish tone, as she said the US central bank would continue to provide accommodative monetary policy to support the US economy but warned against a prolonged period of lower rates in order to avoid a situation which forces the Fed to “raise rates rapidly."