A gauge of the dollar eased 0.2% ahead of the May US employment report and after weak factory data added to the case for a pause in Federal Reserve tightening. The Aussie rose after an increase to the minimum wage was announced.

The Bloomberg Dollar Spot Index fell for the fifth day of the last six to be down 0.8% on the week and is poised to snap a three-week advance. The Aussie rose as much as 0.7% after the higher minimum wage further complicated the wage-price spiral. Short-covering against the yen topped out around 139.00 option strikes, according to traders.

Investors kept their powder dry before the monthly jobs report on Friday, with forecasters projecting a moderation in the pace of hiring that could potentially allow the Fed to pause its policy tightening in June, despite a solid ADP private sector jobs report Thursday.

AUD/USD rose 0.7% to 0.6615.

Pricing for a hike at Tuesday's RBA meeting edged toward 40%, up from 21% Thursday as local yields turned higher in the wake of the wage news.

Bloomberg Dollar Spot Index eased 0.2%.

Yield on 10-year Treasury rose 1.5bps to 3.61%.