the Australian dollar has shrugged of talk of another interest rate cut to hold onto its overnight gains.
At 1200 AEDT on Tuesday, the currency was trading at 104.03 US cents, up from Monday's close of 103.67 US cents.
The Australian dollar followed US and Europe share markets higher on Monday night amid positive sentiment surrounding key US budget negotiations.
Easy Forex senior currency dealer Francisco Solar said it faced downward pressure on Tuesday morning after ratings agency Moody's downgraded France's credit rating.
But the Australian dollar held around the 104 US cent mark and appeared to have taken in its stride a statement from the Reserve Bank of Australia that further interest rate cuts may be needed in the coming months.
Mr Solar said the release of the minutes from the RBA's November meeting showed the cental bank believed the cash rate's current level of 3.25 per cent was appropriate, but it had also left the door open to a rate cut as soon as next month.
A rate cut would make the Australian dollar less attractive to overseas investors.
"But for the time being it looks like markets have taken this as nothing really new," Mr Solar said.
Mr Solar said developments in the conflict in the Middle East would have a major effect on the Australian dollar over the coming days.
Meanwhile, Australian bond futures prices were lower at noon.
At 1200 AEDT on Tuesday, the December 10-year bond futures contract was at 96.935 (implying a yield of 3.065 per cent), down from 96.990 (3.010 per cent) on Monday.
The December three-year bond futures contract was trading at 97.410 (2.590 per cent), down from 97.460 (2.540 per cent).