SYDNEY, Feb 26 — The dollar nursed modest losses early today, having eased for a second straight session after recent remarks from the head of the Federal Reserve prompted markets to push back the timing of an eventual US interest rate hike.

The euro edged up to US$1.1362 (RM4.09), up from this week’s trough of US$1.1288, but remained stuck in a US$1.12-US$1.15 range held since hitting an 11-year trough of US$1.1098 a month ago.

Against the yen, the greenback slipped to ¥118.86 (RM3.60), off this week’s high of 119.84. Yet, it too has been struggling for direction since peaking at a 7-1/2-year high of ¥121.86 in early December.

The dollar, however, made a clear break lower against both sterling and the Australian dollar. The pound touched a two-month high of US$1.5538, while the Aussie dollar popped above 79 US cents for the first time in a month.

Since Fed Chair Janet Yellen’s congressional testimony on Tuesday, markets have shifted their expectations of an initial rate hike toward the end of the year.

Yellen told the Senate Banking Committee the Fed would first remove the word “patient” in describing its approach to interest rate hikes, then enter a phase in which moves are possible at any meeting.

She did not offer any additional insight on the timing of a rate increase before the House of Representatives Financial Services Committee yesterday.

“The only thing that is clear is that FOMC has given itself more flexibility than before,” said Ray Attrill, Global Co-Head of FX Strategy at National Australia Bank.

“If US data begins to positive surprise once more, the market will quickly jump back onto the ‘Buy USD’ bandwagon.”

There were no such surprises yesterday, though data showed new US single-family home sales fell only slightly in January despite big declines in the winter-battered Northeast.

In Asia, all eyes are on Australia’s private sector capital spending data for the fourth quarter and the first estimate for spending in the 2015-16 financial year.

Analysts are keen to see if there will be a pick-up in spending intentions from non-mining companies to offset the cooling resources sector. Any upside surprises will no doubt help lift the Aussie dollar. — Reuters