Overnight the local unit faltered under the strain of weaker sentiment which saw US equities retreat after a recent string of positive sessions. The Aussie took a south-bound turn early in European trade falling to lows of 100.87 US cent over the course of US trade alongside US equities.

The focus of the US session was Fed Chairman Ben Bernanke testimony before the House of Reps Budget Committee. Most analyst expected a repeat of the 'low inflation and slow jobs growth' mantra and that exactly what we got with a bit of pro-QE2 comment mixed in for good measure.

The top currency status belonged to the Euro overnight amid conjecture over the likely successor of the ECB Presidency from current President Jean Claude Trichet whose term is expiring in October 2011.

This weighed on the Euro earlier in the session as investors speculated a change in leadership may see the ECB's willingness to take the hard line on price pressures may subside; however it sprung back to life to make a convincing break of US$1.37 for the first time in nearly a week. The Euro was up across the board also making impressive gains against the Aussie dollar which has fallen over 1 percent against the Euro in the last 24 hours.

The day ahead will see the local unit contingent on local employment data due for release at 11.30am AEDST. The Australian economy is expected to have shown 20,000 new jobs in the month of January against previous growth of 2,300. Recent releases have seen a significant deviation from estimates surprising mostly to the upside - however we may very well be in for a surprise to the downside tomorrow.

There's little doubt the impact of Queensland's flood and cyclone disasters will take its toll on employment growth - and tomorrow could present the first real signs of Queensland's natural disasters resonating through the economy. At the time of writing the Aussie dollar is buying 101.15 US cents.