Dollar trading higher, despite jobs figures

THE dollar was trading around US1c higher at noon, despite pulling back on weaker than expected employment figures.

THE dollar was trading around US1c higher at noon, despite pulling back on weaker than expected employment figures.

At midday (AEDT), the local unit was trading at US99.39c, down slightly from US98.51c yesterday.

Since 5pm yesterday, the dollar traded between US99.23c and US99.74c.

Royal Bank of Scotland FX strategist Greg Gibbs said the lower number of full time and part-time jobs created during December had led to the decline.

"The Aussie dollar came down after the jobs report," Mr Gibbs said.

The local currency was holding on to its overnight gains due to positive global sentiment, however, he said.

"You're seeing commodity prices rise globally. A stronger euro and a weaker dollar, and the Aussie has traded accordingly."

Australia's unemployment rate was a seasonally adjusted 5.0 per cent in December, compared with an unrevised 5.2 per cent in November, the Australian Bureau of Statistics (ABS) said today.

Total employment rose by 2,300 to 11.417 million in the month, seasonally adjusted.

Wall St stocks rose broadly overnight after a successful bond auction in Portugal eased worries about Europe's debt crisis. Financial shares jumped on hopes that banks would start raising their dividends this year.

"There's a good chance we're going to start pushing above parity relatively soon," Mr Gibbs said.

"But the market is probably reluctant to go too far pending some important numbers out later in the week."

Meanwhile, at noon on the ASX 24, the March 10-year bond futures contract price was 94.425 (implying a yield of 5.575 per cent), down from yesterday's close of 94.470 (5.530 per cent).

The March three-year bond futures contract price was 94.900 (5.100 per cent), down from 94.960 (5.040 per cent).