THE Australian dollar slipped slightly today on the absence of a clear plan to resolve the euro-zone debt crisis. Even so, an apparently indecisive Europe has done little to dent a strong rebound in the currency so far this week after those debt worries had sent the Australian dollar down about 6 per cent last week against the US dollar. In the short term, the currency is likely at the mercy of whether Greece can obtain more aid to avoid defaulting on its debt obligations. In the latest development, euro-zone members are divided over how much of a hit private creditors should take in a second bailout of Greece, according to The Financial Times. Regardless, David Greene, senior corporate foreign exchange dealer at Western Union in Sydney, said he expects that the uber-volatility of the past week may be over. "Barring any really adverse data releases out of the US or Europe, or negative commentary on the (European Financial Stability Fund), I expect the markets to be fairly stable. I think the market has worn itself out a little bit," said Mr Greene. At 4.20pm AEST, the Australian dollar was at $US0.9875, down from $US0.9891 late yesterday, with Mr Greene tipping support at $US0.96000 should Greece concerns grow in European action. Against the Japanese yen, the Australian dollar was at Y75.625, up slightly from Y75.566. Despite the bounce, Westpac foreign exchange strategist Sean Callow said he expects the Australian dollar to move to Y72.00 by the year's end given confusion over the outlook for both the euro zone and the US. In the bond market, much of the focus was on a tender of Australian 2021 dated bonds that drew a very quiet response as investors seemingly decided the yield on offer was too low, according to one bond strategist. Unlike tenders in Europe, which are dogged by credit worries, Australia holds a solid AAA rating, with the strategist saying the weak response was expected, given that strong demand recently has driven yields to a point where investors pressed 'pause'.

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