The Australian currency hit a fresh 25-month high on Wednesday noon, following talks the Federal Reserve might reinvigorate stimulus measures to aid the ailing US economy.

At midday AEST, the domestic dollar was buying at 95.64 US cents, its highest since August 1, 2008 and up one US cent from Tuesday's finish of 94.54 cents.

Since 7am AEST, it had changed hands between 95.82 cents and 95.28 cents.

The Aussie shot up one US cent overnight, after the US Federal Reserve signalled it was ready to further stimulate the US economy, raising fears it may print more greenback to do so, according to CMC markets foreign exchange dealer Tim Waterer.

"US dollar buying remains very much on the sidelines," he said.

"That's let the Aussie move to 95 US cents with little resistance."

In a statement on Tuesday night (AEST) the Fed said it is "prepared to provide additional accommodation" to the US economy.

Mr Waterer said the statement by the Fed's policy making arm, the Federal Open Market Committee (FOMC), opposed recent comments by the Reserve Bank of Australia.

In the minutes of RBA's September board meeting, released on Tuesday, the central bank said it was ready to lift the cash rate if economic strength continues to point to higher inflation.

Mr Waterer also said the Aussie had taken support from strong commodity prices, especially gold.

"Gold and the US dollar are competing asset classes," he said.

"The only thing that could get the US dollar (a reserve

currency) back in favour is some negative news out somewhere."