The dollar is still higher after getting a boost from better US employment figures, increasing optimism about the America's economic recovery.
At 5pm AEST, the local unit was trading at $US1.0272, up from $US1.0254 on Friday.
The Aussie rallied at the end of last week after US economic data showed the country's unemployment rate fell 0.1 per cent to 7.5 per cent in April.
But during local trade this morning the currency fell as low as $US1.0272 after official figures showed local retail spending fell 0.4 per cent in March, but was up 2.2 per cent in the March quarter.
CMC Markets senior trader Tim Waterer said the US payrolls figures were warmly received by Asian markets this morning.
"The US jobs data gave the global growth landscape a more convincing appearance, commodities received renewed buying interest and this is reflected in the performance of resource stocks," he said.
"Despite a push higher on Friday night after the US jobs number, the Australian dollar gave back ground today with a potential interest rate cut on the cards over the coming month or two."
The RBA has its May board meeting tomorrow.
All 13 economists surveyed by AAP last week said they don't think the RBA will reduce the cash rate from its current level of three per cent but the futures market is pricing in a 57 per cent chance of a cut.
