The Australian dollar has gained against its US counterpart, after the greenback slipped following a lower than expected US inflation report on Friday.

At 0630 AEDT on Monday, the local currency was worth 78.82 US cents, up from 78.34 US cents on Friday.

Data showed on Friday that US CPI rose 0.5 per cent in September against an expectation of 0.6 per cent, while the core measure rose only 0.1 per cent versus 0.2 per cent expected.

The data pushed stocks higher, but bond yields and the US dollar fell.

The Australian dollar rose as high as 78.97 US cents before consolidating gains.

Westpac senior market strategist Imre Speizer expects the Aussie dollar to rise past the 79 US cents nlevel if there is further correction in the greenback.

On Monday, the local currency was also slightly higher against the Japanese yen and the euro.

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