ANALYSTS BELIEVE AUSTRALIAN DOLLAR CAN STRENGTHEN FURTHER.

SYDNEY, June July 1 Asia Pulse - Australia's dollar gained more than five US cents over 2001/02 and strategists believe it can push higher in the new financial year.

Propelled by US dollar weakness and wide interest rate differentials, the local currency has fought back in the second half of last financial year after skirting perilously close to its all time lows in September.

The Australian dollar closed 2000/01 only a shade above 50 US cents at 50.79 and since then has jumped 5.66 US cents to close on Friday at 56.45, the final local trading day of 2001/02.

In 2001/02, the local currency came close to its all time lows, reaching 48.20 US cents soon after the US terrorist attacks on September 11.

But since then US dollar weakness has been on the local dollar's side, pushing it last week - in the final days of the financial year - to a 22 month high of 57.92 US cents.

"If in 1999/2000 the story was in the strength of the US dollar, half way through 2001 to June 2002, the story's been the weakness of the US dollar and the corresponding benefit that the Aussie's got," Macquarie Bank currency strategist Geoff Bowmer said.

Commonwealth Bank currency strategist David Moore said the key influence on the Australian dollar has been a shift in investor sentiment from the US dollar to the local currency.