The Australian dollar is more than half a US cent higher, following optimistic job figures from the US.
At 1700 AEST on Monday, the local unit was trading at 105.60 US cents, up from 104.95 cents on Friday.
IG Markets market strategist Stan Shamu said the local currency had responded well to the release of strong US non-farm payrolls data.
"The Australian dollar had a big run on Friday night on the back of a rally in risk assets after a better-than-expected reading in the US payrolls number," he said.
"We also had a lift in sentiment following comments from Spain's prime minister who said he would consider a bailout - that appeased investors a little bit."
Friday's non-farm payrolls data showed that 163,000 jobs were added to the US economy in July compared to an expectation of 100,000.
Mr Shamu said the higher demand for risk assets had continued on Monday morning, but softened as they day progressed.
"It's relatively flat compared to Friday's position, and there's a bit of caution as well ahead of the RBA (Reserve Bank of Australia) decision," he said.
The RBA meets on Tuesday for its monthly rate decision - and is expected to keep the cash rate on-hold at 3.5 per cent.
At AEST, the Australian dollar was at 82.74 Japanese yen, up from Friday's close of 82.10 yen, and at 85.37 euro cents, down from 86.06 euro cents.
Meanwhile, Australian bond futures prices are lower.
At 1630 AEST on Monday, the September 10-year bond futures contract was trading at 96.835 (implying a yield of 3.165 per cent), down from 96.975 (3.025 per cent) on Friday.
The September three-year bond futures contract was at 97.270 (2.730 per cent), down from 97.450 (2.550 per cent).
FIIG director of strategy and market development Stephen Nash said bond prices were lower in response to the US jobs data.
"The market has been concerned about the US employment report, which was much better than expected," he said.
Dr Nash said he expected other issues, such as the euro zone debt crisis, to return to influence the market later in the week.