On Monday, the Australian dollar opened two US cents lower; a reaction when markets expressed worries of a soft jobs report in the US that suggested a slower than expected recovery in the world's largest economy.

At 0700 AEST on Monday, the Australian dollar was trading at $US0.8198/05. The currency was down 3.1 per cent from Friday's close of $US0.8462/65.

Since 1700 AEST on Friday, the local unit traded between $US0.8200 and $US0.8477.

The Demand for growth assets such as equities and commodity-driven currencies plunged on Friday's off shore session (AEST) after a report revealed that the US economy created fewer jobs than expected.

The US Department of Labor said that America added 431,000 jobs in May this year of which most were temporary government jobs for the 2010 census.

The figures, however, were below the market median forecast of 536,000 jobs.

Private business jobs rose by 41,000, the fewest number of workers added in the sector since January.

Unemployment rate fell 0.2 percentage points to 9.7 per cent in May, even when US added jobs this year.

After the data release, the Dow Jones industrial average closed 3.15 per cent lower, while the broader-based Standard & Poor's 500-index was at 3.44 per cent lower.

ICAP senior economist Adam Carr said that they saw massive flow into safe-haven assets on Friday night for a couple of reasons. ICAP is a global interdealer broker and post-trade services provider.

"Payrolls were slightly weaker than expected and, inexplicably, the Hungarian PM said the country could default," said Mr. Carr.

"The euro was off and the US dollar index was up sharply," added Mr. Carr.

Spokesman to Hungary's Prime Minister Peter Szijjarto, said the nation's economy was in a "grave" situation but the government was ready to avoid a crisis similar to Greece, which was bailed out by the European Union.

Hungary is a member of the European Union but the country does not use the Euro currency.

The country has received a bailout of 20 billion Euros from the International Monetary Fund and other institutions in 2008 to help it avoid a default on its loans.

Mr. Carr said that the Australian dollar is expected to trade between US$0.8200 and US$0.8250 later today.