The Australian dollar is almost US2¢ lower, hurt by a big pre-dawn rally in the US dollar.
Late on Friday, the Australian dollar was trading at US100.63¢, down from US102.43¢ on Thursday.
The Australian currency fell to US100.47¢ early on Friday, its lowest level since June.
Early on Friday morning, the US dollar shot to 101.21 Japanese yen, passing the 100-yen mark for the first time in four years.
FOREX.com research analyst Chris Tedder said the greenback's surge came after a report showed that US claims for unemployment benefits last week dropped to their lowest level in more than five years.
He said this further sign of strong employment growth sparked speculation that the US Federal Reserve may start to scale back its economic stimulus programs, which have weighed on the American dollar for the past couple of years.
"A break to parity with the US dollar may elude the Aussie for now, given the strength of support around US100.5¢ and US100¢," Mr Tedder said.
"However, we can see further Australian weakness in the long term. If the walls around parity fall in the near term, then we may see price action replicate the massive sell-off of April and May last year."
A currency report by banking major HSBC said a break below parity against the US dollar may be seen in the near future.
"The combination of the RBA's rate cut, the sharp fall in commodities and weak data from China has been particularly painful for the Aussie dollar," HSBC said in a note to clients. "We continue to see downside pressure and believe a break below parity against the USD may be seen in the near future."
The Australian currency traded in a tight range for the remainder of the day session, showing no reaction to the Reserve Bank of Australia's statement on monetary policy, which reaffirmed economic growth forecasts and cut inflation forecasts.
Markets on Friday night will be closely watching a speech by US Federal Reserve chairman Ben Bernanke to a conference hosted by the Chicago Federal Reserve.