The Australian dollar has jumped above 88 US cents after the Turkish central bank aggressively raised its interest rates to support its currency.
At 1200 AEDT on Wednesday, the Australian dollar was trading at 88.16 US cents, up from 87.76 cents on Tuesday.
The Turkish central bank hiked its overnight lending rate to 12 per cent from 7.75 per cent, in the wake of a sharp fall in the value of Turkey's currency, the lira.
That saw a rally on equities and currency markets, including for the Australian dollar, Westpac senior currency strategist Sean Callow said.
"It's not very often we wait for the outcome of the Turkish central bank meeting," he said.
"Turkey is seen as one of the key reasons for the jitters in emerging markets over the past couple of weeks.
"The market wanted them to shore up their currency with an aggressive rate hike. They did that and actually went further than they were expected to.
"It's really one of the biggest rate hikes you'll ever see and the markets have taken it very well."
Meanwhile, Australian bond futures prices were lower.
At 1200 AEDT on Wednesday, the March 2014 10-year bond futures contract was trading at 95.970 (implying a yield of 4.030 per cent), down from 96.035 (3.965 per cent) on Tuesday.
The March 2014 three-year bond futures contract was at 97.080 (2.920 per cent), down from 97.160 (2.840 per cent).