The story
Uncertain. The term is believed to originate from an Australian language spoken in coastal New South Wales; however, it was initially employed by white settlers as a pidgin to facilitate communication with the indigenous population. This term was quickly incorporated into their languages, sometimes even before the actual arrival of horses, thereby complicating the determination of its origins. It is conceivable that each group believed they were using the other's word.
Etymology from Wiktionary, CC BY-SA 4.0.