Aussie dollar trades slightly higher on gains in commodities, weaker U.S. dollar

The Australian dollar is trading slightly higher against the greenback on Monday following a slightly weaker U.S. dollar and small gains in industrial commodities.

At 0700 AEDT on Monday, the Australian dollar was trading at 71.76 U.S. cents, up from 71.41 cents at Friday's Asian close.

The Australian dollar was offered support in Friday's offshore trade from gains in commodities, excluding oil, and the generally softer U.S. dollar which fell in line with U.S. stocks, National Australia Bank global co-head of FX strategy Ray Attrill said in his morning note.

"A little surprising perhaps to see the Australian dollar pulling back up so much given risk-aversion and higher volatility," Attrill said.

Risks, however, remain to the downside as pressure from oil, industrial commodities and equity markets will limit further gains in the local unit in what is expected to be "a relatively quiet week" on currency markets, CBA chief currency strategist Richard Grace said.

At 1005 local time (AEDT), the Australian dollar was trading at 71.69 U.S. cents. Endit