The Australian currency closed stronger on Monday after a rally on the local bourse augmented last week's gains.

At closing, the local unit was changing hands at $US0.9170, an increase from Friday's finish of $US0.9082.

The Aussie was boosted by a positive day on the local sharemarket in an otherwise quiet day, according to CMC Markets foreign exchange dealer Tim Waterer.

''For the most part it was a quiet day for the Aussie,'' Mr Waterer said.

''Til lunchtime we had local stocks not doing anything, then shares were up 34 points or so and the Aussie went up 20 pips.''

A broad-based rally propped up the benchmark S&P/ASX200 index 34.3 points to 4,575.5 points at the local close. The broader All Ordinaries index, meanwhile, gained 38.1 points at 4,615.7 points.

Mr Waterer said a US Labor Department report indicating the economy lost 54,000 jobs last month and the unemployment rate increased to 9.6 per cent gave a boost to risk.

The job losses figures were much lower than the 120,000 fall forecast by Wall Street economists and incited a bout of risk buying on US markets.

According to Mr Waterer, the direction of the Aussie on Monday night would depend on European stocks and whether they would continue the mood of the Asian trading day.

''Certainly $US0.9170 or $US0.92 will happen tonight if we see European markets decide to keep momentum on equities,'' he said.