Currency analysts say uncertainty about the US budget deadlock is affecting the Australian dollar.
The dollar has see-sawed in the past two days, as investors watch next year.
Currency strategist Kara Ordway from City Index has told ABC News 24 that she expected the volatility to continue in coming weeks, depending on whether a deal on the fiscal cliff was struck.
"Looking to the downside, (the dollar) would very easily push through the 103 [US cent] mark I would have thought if we don't see any good news," she said.
"On the upside, it could push through 105 once again if we do hear good news, so certainly some volatility on the plate to come." Ms Ordway says low trading volumes, which are typical at this time of year, are magnifying the effects of the uncertainty.
"A lot of traders are on holiday.
This creates some very choppy trade in the markets where not a lot of volumes are going through," she said.
"That's where we have seen some big, short, sharp moves, particularly for the Australian dollar, where a lot of traders are worried about this fiscal cliff situation, where they do need to get something in place by the end of the year."