The Australian dollar has opened higher on the possibility of developments on a eurozone debt crisis solution.
At 0700 AEDT, the Australian dollar was trading at 98.87 US cents, up from 98.57 US cents yesterday afternoon.
HiFX trading director Mike Hollows said the local currency had been pushed higher after a good night for international equities, on the back of varied bailout news in Europe.
"We saw European equities surge quite strongly, and that followed onto the US ones - the Dow's currently up two and a half per cent," he said.
"There were rumours that the IMF was potentially looking at structuring a 600-billion euro loan to Italy - that's been denied, but it was certainly encouraging.
"Anything which gives us hope from a European perspective is going to be a huge positive, at least in the short term."
After four weeks of declines, the Australian dollar was showing some signs of rallying, Mr Hollows said.
"There's been a lot of negativity in recent weeks, and we've seen at least a short recovery," he said.
"The Aussie did actually go up considerably higher (last night) than where it currently is - around the 99.75 level, so not far off parity.
"The Euro-skeptics are still very much out there, and I guess at this point we're still stuck in the middle of a range."
Over the weekend, Italian newspaper La Stampa cited IMF officials as proposing a debt loan for the country, and pressure on German chancellor Angela Merkel grew to increase the role of the European Central Bank as a possible source of funds.
Eurozone finance ministers will attend their last meeting of the year on Tuesday (European time) in Brussels, with a program focused on setting rules for borrowing against the European Financial Stability Facility.
