The Australian dollar has tumbled almost two US cents to its lowest level in more than 11 months and could move back below parity with the greenback in the next 24 hours.

The currency fell to 100.47 US cents early on Friday, its lowest level since June 2012.

But at 0700 AEST on Friday, the Australian dollar had recovered some ground and was trading at 100.92 US cents, but was still well down from 102.43 US cents on Thursday afternoon.

Bank of New Zealand currency strategist Mike Jones said the sharp fall was the result of a surge in the value of the US dollar against all major currencies.

“Currency markets have certainly exploded into life,” he said.

“Investors have bought the US dollar with gay abandon and the Aussie dollar has been caught up in that; it’s copped an absolute hiding.”

He said the rally in the US dollar came after the greenback pushed above a key level against the Japanese yen.

“A lot of investors were waiting for the US dollar to break above 100 yen and now that has happened it’s prompted a piling back of big investors into the US dollar.”

Mr Jones said the Australian dollar may regain some ground early on Friday as investors took profits after the sharp fall but, he added, it could move lower later in the day, possibly dropping below 100 US cents on Friday night.