Dollar trading higher at noon

THE Australian dollar is almost two thirds of a US cent higher after an overnight rally.

THE Australian dollar is almost two thirds of a US cent higher after an overnight rally.

At 12pm AEDT today, the currency was trading at 102.8 US cents, up from 102.18 cents yesterday afternoon.

ForexCT head of research Steven Dooley said the Australian dollar had lifted in a quiet overnight session, helped along by gains in US stocks.

"Last night was an interesting move because there wasn't really an awful lot to drive it," he said. "It was clearly a commodity currency move, a bit of risk-on sentiment."

Mr Dooley said there had been a resurgence in demand for the Australian dollar since it hit an eight-month low of 101.15 US cents on March 4.

"The Aussie is seeing a lot more buying than we have seen in the last three or four months," he said.

He said the currency could continue to move higher but would meet resistance around the 103 US cent level.

"If we can break above that level then certainly we could see a continuation of that move higher."

Meanwhile, Australian bond futures were lower.

At 12pm AEDT today, the March 10-year bond futures contract was trading at 96.405 (implying a yield of 3.595 per cent), down from 96.445 (3.555 per cent) yesterday afternoon. The March three-year bond futures contract was at 96.975 (3.025 per cent), down from 97.025 (2.975 per cent) previously.