The Australian dollar is lower as pressure on the US dollar eased ahead of the US Federal Reserve chair Janet Yellen’s speech.

The local currency was trading at 75.36 US cents at 0635 AEDT on Thursday, up from 75.44 US cents on Wednesday.

Yellen used her speech to outline her optimism for the US economy heading into 2017, saying that she and her colleagues expect to raise rates a few times this year.

“Although inflation has been running below our two per cent objective for quite some time, we have seen it start inching back toward two per cent last year as the job market continued to improve and as the effects of a big drop in oil prices faded,” she said.

The speech cements sentiment aired by the Federal Reserve last year about inflationary activity in the US economy, after half-a-decade of trying to stimulate the economy with low rates following the GFC.

With AAP

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