The Australian dollar is higher after the Reserve Bank of Australia deputy governor shied away from talking the currency down.

At 1200 AEDT on Tuesday, the local unit was trading at 91.91 US cents, up from 91.30 cents on Monday.

In recent weeks RBA governor Glenn Stevens has been saying the Australian dollar is a drag on the non-mining parts of the economy.

However his deputy Philip Lowe gave a speech in Sydney on Tuesday morning that did not focus on the high exchange rate.

Forex.com research analyst Chris Tedder said the Australian dollar shot to an intraday high of 92 US cents because Dr Lowe shied away from talking the currency down.

“The comments from Glenn Stevens’ number two at the RBA weren’t nearly as aggressive as earlier comments from the governor himself,” Mr Tedder said.

“While (Dr) Lowe stated that he expects a further adjustment in the commodity currency and the RBA cannot rule out intervening in the foreign exchange market, he added that the threshold for intervention is high.

“We take this to mean that the Aussie would have to be considered extremely overvalued and negatively impacting growth before the RBA would intervene in the FX market and attempt to weaken it.”

Mr Tedder does not think the RBA will have to sell Australian dollars to weaken the currency.

“The bank expects the Aussie to weaken naturally and the RBA knows the impact of intervention may be short-lived and that it could be fighting an uphill battle,” he said.

Markets are now waiting on the release of US housing data for September to be released during the offshore session on Tuesday night.

Meanwhile, the Australian bond market was firmer.

At 1200 AEDT, on Tuesday, the December 10-year bond futures contract was trading at 95.815 (implying a yield of 4.185 per cent), up from 95.775 (4.225 per cent) on Monday.

The December three-year bond futures contract was at 96.910 (3.090 per cent), up from 96.870 (3.130 per cent).