The Australian national currency gained today and was trading at $US1.0472 compared to $US1.0397 in the afternoon session as the US lawmakers reached a last minute deal to avoid the fiscal cliff situation.

Dealers said that the Australian dollar could rise to a level above $US1.05 following an agreement to avoid US fiscal changes. The agreement resulted in improved investor sentiment and enabled investors to sell the US dollar, which is world's largest reserve currency.

The US senators have finally passed a legislation to avoid the automatic changes in the taxes and spending in the US economy. With a pre-dawn vote of 89-8, the senate will now be able to avoid a combination of automatic tax increases and spending cuts. The law now paves the way for a decision in the House of Representatives, where the vote is expected on Tuesday or Wednesday.

President Barack Obama and congressional leaders have both said that they are committed to address the issue by reaching an agreement in time. Senate Republican leader Mitch McConnell said that the agreement should have been reached much earlier and this should not be the way the lawmakers address economic issues.

The agreement is a positive development for the global economy and currencies are expected to rise due to indications of a strong recovery in the Us, now that the cliff situation is avoided.