Australian dollar lower ahead of US jobs data

THE dollar was more than half a US cent lower as the US dollar firmed ahead of key US employment data due overnight (AEDT).

THE dollar was more than half a US cent lower as the US dollar firmed ahead of key US employment data due overnight (AEDT).

At 5pm (AEDT), the local unit was trading at 99.29 US cents, down from 99.83 cents yesterday.

Since 7am (AEDT), the dollar traded between 99.20 US cents and 99.50 cents.

Commonwealth Bank currency analyst Richard Grace said the stronger US dollar was weighing on the Australian dollar.

"There's a firmer US dollar running through the market and there's an expectation that there'll be some upside risk to tonight's non-farm payrolls, so I think that's keeping the US dollar well bid," Mr Grace said.

"The Aussie, of course, feels the weight of that.

"The Aussie has done reasonably well on the crosses.

"I don't think it's a weak Australian dollar story, I think it's a firmer US dollar story."

Official US employment data will be released on Friday night, which comes after recent economic numbers showed signs that the US recovery is strengthening.

The US jobs figure is expected to stronger than previously anticipated after the ADP private sector employment survey posted its biggest monthly increase in jobs in 10 years.

The market will be closely watching US Federal Reserve chairman Ben Bernanke's testimony to a US Senate budget committee on Friday night.

Mr Grace predicted the firmer US dollar would continue to put pressure on the local currency.