The Australian dollar is higher on comments by German Chancellor Angela Merkel about the role of the European Central Bank (ECB) in the region's debt crisis.
At 1200 AEST on Friday, the local unit was trading at 105.09 US cents, up from 104.83 cents on Thursday.
Commonwealth Bank currency strategist Peter Dragicevich said the Aussie dollar had risen overnight, but remained subdued on Friday.
"We had quite a positive run-up last night on the back of comments from (German chancellor) Angela Merkel," he said.
"But today it's been pretty range-bound."
On Thursday, Mrs Merkel said she supported the idea of the ECB coming to the aid of ailing euro zone countries.
Mr Dragicevich said he didn't expect much movement later in the day, given a lack of domestic or global data on Friday.
However, there would be several events in Europe to influence the market next week.
"There are a number of meetings scheduled between European leaders," he said.
"The Greek prime minister (Antonis Samaras) is meeting with the president of the euro zone group (Jean-Claude Juncker), as well as Angela Merkel and the French president (Francois Hollande) later on in the week."
Meanwhile, bonds were higher at noon.
At 0830 AEST on Friday, the September 10-year bond futures contract was trading at 96.615 (implying a yield of 3.385 per cent), up from 96.605 (3.395 per cent) at Thursday's close.
The September three-year bond futures contract was at 97.150 (2.850 per cent), up from 97.140 (2.860 per cent.)
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