The Australian and New Zealand dollars huddled near 11-month lows on Friday having endured a torrid week as the whipping boys of Wall Street, finding only temporary support from speculation about higher interest rates at home.

The commodity-sensitive currencies often track global risk sentiment and tend to take a hit when equity markets slide, as they have done this week.

A bounce in U.S. stock futures early Friday did help the Aussie edge up to $0.6333, but it was still uncomfortably close to Thursday's trough of $0.6271.

The kiwi dollar was hanging on at $0.5822, after hitting a low of $0.5774 the previous session.

"Proxies for investor sentiment towards China and the U.S. appear to be the heaviest weight on the Aussie," said Sean Callow, a forex analyst at Westpac. "Given the ongoing war in the Middle East, AUD/USD seems likely to now target $0.6200."

"But the Aussie has a degree of support from rate expectations that it has rarely had since the pandemic," he added "Westpac now believes a November hike is more likely than not." A surprisingly high inflation reading this week has seen markets revise up the chance of hike in the 4.1% cash rate in November, which is now seen as a 50-50 call.

RBA Governor Michele Bullock on Thursday refused to be drawn on the prospects for tightening, but reiterated the central bank had little tolerance for higher inflation. The RBA's next policy meeting is on Nov. 7.

"We now put the probability of a 25-basis-point rate increase at 70%," said Gareth Aird, head of Australian economics at CBA. "The upshot is that the cash rate is likely to stay at a restrictive level for longer to pull inflation down to the desired level."

Indeed, markets imply some risk rates could peak as high as 4.60% and have priced out any prospect of a cut in all of 2024.

Aird sees a good chance of an easing in September next year as data should show inflation clearly heading back into the RBA's 2-3% target band. "Our base case looks for 75bp of easing in late 2024 for an end year cash rate of 3.60%," he said. "We have a further 75bp of easing pencilled in over first half 2025, which would take the cash rate to 2.85%." (Reporting by Wayne Cole; Editing by Simon Cameron-Moore)