The Australian dollar is slightly lower after peaking at a two-week high, following the release of weak Chinese and Australian manufacturing data.
At 1700 AEST on Wednesday, the local unit was trading at 103.54 US cents, down from 103.58 on Tuesday.
The currency rose to 103.86 US cents just after midnight on Wednesday, its highest level since April 17.
The Australian dollar's overnight gain was helped by a rise in US stocks on the back of solid US housing and consumer confidence figures.
Australian Industry Group data showed the manufacturing sector recorded its 15th consecutive monthly slowing in activity and largest slowdown since May 2009.
Also on Wednesday, the Purchasing Managers' Index (PMI) showed the pace of manufacturing activity in China slowed slightly in April,
Forex.com research analyst Chris Tedder said the Chinese figures did not appear to have worried the market too much.
"On the whole, the figures aren't disastrous by any means, but may weigh on sentiment if we continue to see disappointing data out of China," he said.
"The reaction to today's PMI data was limited, largely because there is a bank holiday in China and the headline figure was only just below market consensus."
At 1700 AEST, the Australian dollar was at 100.88 Japanese yen, down from Tuesday's close of 101.32 yen, and at 78.61 euro cents, down from 79.19 euro cents.
Meanwhile, Australian bond futures prices were slightly weaker.
UBS interest rate strategist Matthew Johnson said Australian bond futures sold off towards the end of the overnight session after the release of data showing a rise in US consumer sentiment in April.
He said bond futures prices rose after the release of the Australian manufacturing figures.
"The manufacturing sector is continuing to suffer a structural decline, Mr Johnson said.
"So that means the economy could be slowing down, which means the RBA can cut rates so bonds can rally."
At 1630 AEST on Wednesday, the June 10-year bond futures contract was trading at 96.900 (implying a yield of 3.100 per cent), down from 96.910 (3.090 per cent) on Tuesday.
The June three-year bond futures contract was at 97.430 (2.570 per cent), down from 97.450 (2.550 per cent).
Mr Johnson said the outlook was positive for bond markets over the next few days.
The policy-making committee of the US Federal Reserve meets on Wednesday night and the European Central Bank (ECB) meets on Thursday night.
The Fed is expected maintain its economic stimulus program of buying government bonds from banks to encourage them to lend.
The ECB is expected to cut its interest rate or, at least, signal there will be a reduction in June.