The Australian dollar has eased slightly after a strong rise caused by the central bank signalling an end to its easing stance on interest rates.
At 1200 AEDT on Wednesday, the Australian dollar was trading at 89.08 US cents, up from 88.67 US cents on Tuesday.
After the Reserve Bank of Australia's announcement the cash rate will be kept on hold, the currency rose to a peak of 88.94 US cents, its highest level since January 16.
Commonwealth Bank of Australia currency strategist Joseph Capurso says this may have been an overreaction.
"Yesterday's reaction was a bit overdone," he said.
"Most economists think the next move by the RBA towards the end of the year will be up."
Mr Capurso also said Japan's equity market was softer, putting some downward pressure on the Australian dollar.
The local unit is expected to lose more gains overnight after the release of a US employment report, he said.
"The report will probably be very strong and push the greenback up against all currencies and pull the Aussie US dollar exchange rate down," Mr Capurso said.
Meanwhile, Australian bond futures prices have fallen as emerging market fears fade, fuelling investor's risk appetite for equities.
At 1200 AEDT on Wednesday, the March 2014 10-year bond futures contract was trading at 96.020 (implying a yield of 3.980 per cent), down from 96.110 (3.890 per cent) on Tuesday.
The March 2014 three-year bond futures contract was at 97.050 (2.950 per cent), down from 97.170 (2.830 per cent).