The Australian dollar bounced on Friday, boosted by an improved yield advantage as signs the global recovery was gaining momentum and a domestic rate hike might be on the horizon saw local bond yields jump. The Aussie climbed to $0.8054 by late local trade, after hovering around $0.80 for most of the day. It had traded at $0.7952 here late Thursday.
"Aussie rates had moved higher and so there was talk among some banks of rate hikes," said Philip Burke, a currency trader at J.P. Morgan.