Australian shares have bounced back strongly after four consecutive days of falls, but the Aussie dollar tumbled, dogged by talk of the Reserve Bank easing monetary policy further.

The S&P/ASX200 benchmark index closed 139.8 points higher, or 2.4 per cent, to 5923.9 on Wednesday.

The All Ordinaries index rose 137.8 points, or 2.3 per cent, to 6111.3.

At 1615 AEST the Australian dollar was 71.19 US cents, only just above an earlier low of 71.16 US cents, a level not seen since early August.

It had closed at $72.14 US cents late on Tuesday.