The Australian dollar settled just above an earlier low around 77.35 US cents on Friday as the US dollar retained the upper hand against the majors heading into Friday's US payrolls data.
Fears of central bank intervention to stop the USD slide and expectations of another solid rise in US jobs, backing a further interest rate hike in the United States, helped to lift the US currency after its recent battering.
However, analysts expect this to be only a fleeting reprieve for the big dollar as long as US officials are happy to see their currency depreciate to correct its huge current account deficit, and until the Bank of Japan is forced into action to stop a rising yen potentially damaging its exports.
"While few sense central banks are about to embark on a concerted campaign to boost the USD, there are concerns among the short-term trading community that they may try and wreak some short-term damage on their short USD positions," said Greg Gibbs, currency strategist at RBC Capital Markets. The AUD was $0.7742/45 compared with $0.7802/08 late here on Thursday and after a high of $0.7834 in early offshore trade.
Recent bullish Aussie sentiment has cooled this week after an unexpected blow-out in the current account to a record deficit, and following a string of weaker-than-expected data, which subsequently saw the unit make several attempts to breach 77 cents.
The Aussie had gained 16 percent since early September to a 9-month high of 79.47 cents last Friday, just short of the 7-year high of 80.05 cents set in February.
A sharp fall in commodity prices overnight also added to the Aussie's soft tone, with the Reuters CRB Index falling 1.55 percent. Gold, metal and oil prices all weakened.
November US payrolls are forecast to rise 180,000, building on the strong 337,000 increase in October and cementing the case for ongoing US rate rises when the Federal Reserve meets on December 14.