From geo political unrest to a US economy seemingly regaining economic composure, all of which have been supportive for the US dollar at some point this year - but none have yet marked the return of the once might greenback many - including myself - thought possible. In-fact, the US dollar index which measures its value relative to six major counterparts shows quite the opposite with the index falling near 5 percent since the start of the year, amid equally as impressive gains in US equities.

Last week also saw a continuation of this dollar-negative theme with price action depressed by buoyant crude oil prices in light of continued political unrest in the Middle East. Safe-haven plays such as silver, gold, Swiss Franc and Japanese Yen also took the top spot on the beneficiary ladder as the nation Libya descended closer to a full-scale war. In contrast, the lack of buoyancy from the greenback amid escalating Middle East unrest suggest the US dollar no longer displays the same safe-haven properties it was once renowned for, however this doesn't not necessarily mean we're unlikely to see a resurrection of the dollars safe-haven appeal.

Geo-political issues aside, 2011 has seen a distinct lack of uniform from the greenback, and unless the United States becomes an active participant in the Middle Eastern unrest, we can again focus on the US employment picture for the answer to were price action is heading. Without this confirmation of a sustained employment recovery, we're likely to see the US dollar to remain at this critical juncture and continue to cohere to this hybrid of influences until economic signpost point to a jobs-based recovery.  That said, the week ahead is a particularly important week for the greenback, with US Non-farm payrolls due to be released on Thursday which is expected to show the US economy created 183,000 new jobs in the month of February.

If we cast our minds back to January US non-farm payrolls rose by 36,000 falling well short of estimates of 146,000 new payrolls. At the time market participants weighed a meagre jobs number with a steep drop in the unemployment rate which fell to 9 percent from a previous 9.5 percent due to a fall in the participation rate. The underwhelming jobs number had been attributed to horrific winter conditions effectively paralysing jobs growth in central thus delaying hopes of near-term rebound in employment growth.

With seasonal factors dissipating, market whispers suggest we could very well see this week's jobs data grow to the better side of expectation - which is the perfect catalyst to kick start US dollar price action on an upward trajectory for a period however the acknowledgment from the Federal Reserve will be needed to mark a true greenback reversal.

Other important economic indicators this week include personal spending, pending home sales, ISM Manufacturing, Fed's beige book and of course the pre-cursor to Fridays NFP's the ADP employment measure of private sector jobs growth.

Meanwhile, after taking a brief fall from grace early last the week the Aussie dollar was able to regain composure over the course of the week to finish ahead of its US namesake around the 101.7 US cent levels. 

Aussie strength was prominent against Sterling and Kiwi however was unable to gain ground against the in-form Japanese Yen which continues to benefit from turmoil in the Middle East. Although the week ahead carries event risk from a local perspective, the primary driver will likely come from risk trends abroad with US non-farms on Friday to be a 'by default' key directive. In focus locally will be Tuesday's interest rate decision which is strongly tipped to show no change in benchmark interest rates from the RBA.

The finer points will no doubt be scrutinized, however we've recently had a healthy amount of comment from RBA officials which suggests market participants are well and truly informed of the RBA's outlook. In a recent testimony to the House of Representatives economics committee RBA Governor Glenn Stevens provided an outlook of neutrality towards the near-term direction of interest rates, stating I'm fairly content with where we are at the moment.

On inflation, Stevens has once again suggested that whilst the fallout of Queensland's floods and Cyclone Yasi would likely see a temporary rise in consumer prices to around 3 percent in the June quarter, this 'higher inflation, slower growth' scenario should begin to reverse in the second half of the year and should have largely dissipated by the end of 2011.

In short, there's no imminent need for the RBA to tinker with rates and we're likely to see this sentiment translate to the post-decision statement once again. Also in focus this week is 4Q Gross Domestic product due for release on Wednesday. At the time of writing the Aussie dollar is buying 101.4 US cents.