Currency analysts say renewed confidence in the US economic recovery is combining with increasing worries about Australia's economic outlook to push the local currency down against the greenback.

The Australian dollar has dropped sharply over the past two weeks. It's fallen 6 cents against the US currency, taking it to lows not seen since early last year.

To give you a sense of how significant such a move could be, the Aussie traded at 1.05 against the dollar in mid-April. So a drop to $0.80 would be a 23.8 percent decline.

The All Ordinaries added a third of a per cent to 5,160 and the ASX 200 matched that gain to 5,181. The dollar has fallen by around six cents against the greenback over the past three weeks and is also down against a range of other currencies.

With the Australian dollar now firmly trading below parity with the US dollar the benefits to the wider national economy will not immediately help its airlines and will drive changes in their strategies, outlooks and opportunities.

The Australian dollar is higher but is failing to build onto its gains as commodity prices fall. At 1200 AEST on Thursday, the local unit was trading at 98.99 US cents, up from 98.72 cents on Wednesday.

The government forecast an 18 billion Australian dollar ($17.91 billion) deficit for the 2013-2014 fiscal year, with no return to surplus expected until the 2015-2016 fiscal year.

The Australian dollar has fallen to another 11-month low as the currency becomes unpopular with Japanese investors. On Friday morning, the Australian currency dropped as low as 97.53 US cents, its weakest level since June 2012.

The US$0.9850 milestone was the peak in the Australian dollar's rally in 2008 before the unit collapsed 40% after the demise of Lehman Brothers and a world-wide financial crisis.

THE two major political parties were not doing enough to push the Australian dollar down, Queensland Federal MP Bob Katter said on Friday.