Investors have taken advantage of the Australian dollar's decline yesterday amidst further speculation that the Reserve Bank of Australia is bound to adjust interest rates upwards.

The Australian dollar may have chances to pullback at today's auction, although at moderate levels.

"The Aussie is still a very good investment option, though it has been vulnerable to commodity price movements," a currency strategist from the Commonwealth Bank of Australia noted.

Australia's currency increased by as much as 2 percent to 98.84 before trading at 98.82 U.S. cents at 2:30 p.m. in New York from 96.86 cents yesterday. So far this was its biggest intraday gain since Sept. 1. The Australian currency jumped to 80.10 yen from 79.03 yen. New Zealand's Kiwi, on the other hand, rose to 75.65 U.S. cents from 74.41 yesterday

Reserve Bank of Australia policy makers said in the official central bank minutes to its Oct. 5 policy meeting that their decision to maintain key interest rates at the current levels earlier this month was "finely balanced." The central bank, however, emphasized that benchmark rates would likely have to go up "at some point."

Dollar gains

In the last three months, the Australian dollar gained 10 percent against the US currency and so far the best performer vis-à-vis 16 other traded currencies.

After the China central bank unexpectedly raised its rates, exporters took advantage of the Aussie's decline and selling might happen in the next two days driving it to a low of 95.20.