The Australian dollar is higher as traders go bargain hunting, taking advantage of the currency’s low value, after its big fall in recent days.

At 0700 AEDT on Tuesday, the local unit was trading at 91.58 US cents, up from 91.30 cents on Monday.

The Australian dollar fell two per cent last week as the greenback rallied after the US Federal Reserve said it expected economic data in the coming months to improve enough to allow it to taper its massive bond purchase program.

The Australian dollar suffered more downward pressure after Reserve Bank of Australia governor Glenn Stevens said he had an open mind on intervening to push the currency lower.

OM Financial senior client adviser, Stuart Ive, said the Australian dollar was bouncing back after last week’s losses.

“In terms of the Aussie dollar, it’s come a fairly long way from last week followed by the RBA comments,” he said.

“I think the market has taken on board that the RBA wants the currency lower and it would be beneficial to the economy but unless we have further data or action from the RBA, it’s just going to have a pause from its downward slide.”

Ive said the currency market was looking toward the release of US October durable goods data and the weekly unemployment claims figures, both out on Wednesday, Australian time.

“At least until Wednesday, the Australian dollar is going to float around its current levels. We’re not going to see much of a move to the downside,” he said.

Ive expects the Australian dollar to trade in a range between 91.20 and 91.80 US cents on Tuesday.

AAP