* Dollar steady above two-week lows vs currency basket
* Yellen emphasises continuity with Bernanke’s policy approach
* Aussie dollar sets 1-mth high on good Chinese trade numbers
By Ian Chua and Masayuki Kitano
SYDNEY/SINGAPORE, Feb 12 (Reuters) - The Australian dollar hit a one-month high as upbeat Chinese trade data eased concern about China’s economy, while the U.S. dollar held above a two-week low after Federal Reserve chief Janet Yellen offered no surprises in her first congressional testimony.
The Aussie dollar rose 0.2 percent to $0.9052. It touched a high of $0.9063, its strongest level since Jan. 13.
Giving a lift to the Aussie was upbeat trade data out of China, Australia’s biggest export market.
China’s trade performance zoomed past forecasts in January as import growth hit a six-month high, confounding market expectations that the world’s second-largest economy is mired in a deepening slowdown.
The Australian dollar will probably trade in a range of around $0.88 to $0.92 in the near term, said Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo.
“I think it will head higher over the medium to longer term... But whether it can keep heading higher from here after having risen above $0.90 is hard to say,” Maeba said.
“The reason it has been able to rise back to these levels is because of position unwinding,” he said, adding that there remained the possibility that the Reserve Bank of Australia might eventually resort to jawboning to temper the Australian dollar’s gains.
The Aussie has rallied in recent sessions after the RBA last week dropped its bias to cut interest rates and toned down its rhetoric on the currency. This caused the currency to pull away from a 3-1/2 year low of $0.8660 in late January.
Back in December, RBA chief Glenn Stevens had said that an Australian dollar above 90 U.S. cents was not suitable for the economy.
Moves among major currencies were mild, with the U.S. dollar holding steady against a basket of major currencies at 80.650 .
On Tuesday - the day of Yellen’s testimony in Washington - the dollar index had hit a two-week low of 80.448.
The core message on policy from the new chief of the world’s most powerful central bank was that of continuity with the approach taken by her predecessor, Ben Bernanke.
For markets, the bottom line was that the Fed remained committed to winding down its extraordinary stimulus measures for now.
Against the yen, the dollar eased 0.1 percent to about 102.56 yen but remained above the previous day’s intraday low near 102.08 yen.
The euro eased 0.1 percent to $1.3628, staying below a two-week high near $1.3683 touched on Tuesday.
Despite the modest bounce in the greenback, Westpac currency strategist Richard Franulovich warned the near-term prognosis looked challenging.
“U.S. retail sales data later this week for example is likely to underwhelm given known weaker auto and chain-store sales,” he said.
For sterling bulls, the Bank of England’s quarterly inflation report due later on Wednesday will be closely watched.
The report gives the BoE a chance to tweak its forward guidance on policy and firm up a message that interest rates will not rise until well into next year.
Such an outcome could give pause to sterling, which set a near three-year peak of $1.6667 late last month. Sterling last fetched $1.6448, steady from late U.S. trade on Tuesday.