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The Australian dollar is firmer as global markets favour riskier assets.

At 1700 AEDT on Tuesday, the local unit was trading at 90.26 US cents, up from 89.67 US cents on Monday.

Commonwealth Bank currency strategist Joseph Capurso said the currency was initially sold off but recovered later in the day.

"It's really trading in a narrow range," Mr Capurso said.

"The Chinese currency sold off earlier today and that saw the Aussie weaken but it was only 20 points and now it's rebounded."

The local currency's firm performance came after gains on equity markets in Japan and the US.

Positive sentiment was assisted by US dollar weakness as the gold sector continues to strengthen.

At 1700 AEDT, the local currency was buying 65.70 euro cents, up from 65.27 euro cents on Friday, and 92.54 Japanese yen, up from 91.75 yen.

The next release of local economic data is Thursday's private new capital expenditure figures for the December quarter.

Meanwhile, Australian bond futures prices were flat after a session in which they traded in a tight range.

Yields were higher at the start to the session after a US stocks rally fuelled demand for riskier assets.

Continued strength in some high-flying technology equities propelled US stocks higher overnight, with the S&P 500 index almost reaching a record high.

National Australia Bank head of research Peter Jolly said bond futures prices firmed during the course of the day.

"It's been an okay day after we started weaker," Mr Jolly said.

The tight range persists and we're wafting around in ranges as yields haven't moved around for weeks."

Mr Jolly does not expect a big change in tight trading patterns.

"We're going to remain tight as there's not a lot of data out this week," he said.

At 1630 AEDT on Tuesday, the March 2014 10-year bond futures contract was trading at 95.885 (implying a yield of 4.125 per cent), unchanged from Monday.

The March 2014 three-year bond futures contract was at 96.990 (3.010 per cent), unchanged from Monday.