The Australian dollar has risen Tuesday, buying 69.65 US cents from 69.55 US cents on Monday.
Yesterday, the local currency edged higher as its US counterpart is undermined by aggressive wagers on rate cuts from the Federal Reserve, which offset any bearishness from the probability of policy easing at home.
The Aussie was up at 69.57 US cents on Monday and trying to string together a fifth straight session of gains, having bounced from as low as 68.32 US cents last week.
The rise comes with the market already pricing in more than 100 basis points of US cuts by the Fed, outstripping expectations for both the Reserve Bank of NZ and the Reserve Bank of Australia.
Futures imply a greater than 80 per cent chance the RBA will ease again at its meeting next week, and take rates down a total 50 basis points to 0.75 per cent by Christmas.
As a result, yields on Australian 10-year paper hit an all-time low of 1.269 per cent last week having fallen a huge 110 basis points since November.
In the same period, 10-year Treasury yields have shed almost 120 basis points to 2.05 per cent and that is before the Fed has even touched short-term rates.
On Monday, the Australian three-year bond future had eased 2.5 ticks to 99.120, though that was from a record high.
The 10-year contract dipped 3.0 ticks to 98.6850.
There is little in the form of major domestic economic data due this week, leaving the market hanging on any developments in the Sino-US trade dispute at the G20 meeting.
