Investing.com - The Aussie gained smartly as the March CFLP manufacturing gauge in China rose into expansion territory on Friday, surprising on the upside and setting the stage for a more closely-watched measure.
AUD/USD rose 0.35% to 0.7685 with China a key trading partner for Australia. USD/JPY changed hands at 112.35, down 0.20% despite a weak business survey indicator in Japan.
In China, the semi-official manufacturing PMI for March came in at 50.2, compared to 49.3 seen and a final 49 in February. The non-manufacturing PMI came in at 53.8, compared to 52.7 for the final in February. The February month was said to be impacted by a drop in business during the week-long Chinese New Year holidays.
The Caixin manufacturing PMI for March is due shortly with a level of 48.2 seen and 48.0 for the final in February. A level below 50 denotes contraction.
In Japan, the Tankan All Big Industry CAPEX survey came in at minus 0.9%, below the 0.7% drop expected. That was the lowest in nearly three years, with expectations to worsen in the coming quarter, raising questions about the next policy steps. A positive figure indicates the majority of firms see better business conditions.
Earlier, the AIG manufacturing index for March in Australia came in at 58.1, up sharply from 53.5 in February.
Ahead, the Japan manufacturing PMI is due with 49.1 expected, the same level as the final in February.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was quoted down 0.03% to 94.62.
On Friday, the second quarter will kick off with March's critical U.S. jobs report, which could provide key insight into the Federal Open Market Committee's (FOMC) decision-making process when it meets next in late-April.
Earlier this week, Yellen noted that the U.S. economy has displayed remarkable resiliency as the labor market continues to exhibit dramatic improvements.
Analysts expect monthly nonfarm payrolls to increase by 210,000 for the month, while the unemployment rate remains steady at 4.9%. In February, U.S. non-farm payrolls shot up by 240,000, pushing the three-month average above 225,000.
Overnight, the dollar continued to trade at five-month lows against the other major currencies on Thursday, after the release of downbeat U.S. jobless claims data and as sentiment on the greenback remained fragile ahead of Friday’s nonfarm payrolls report.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 26 increased by 11,000 to 276,000 from the previous week’s total of 265,000. Analysts expected jobless claims to hold steady at 265,000 last week.
A separate report showed that the Chicago purchasing managers’ index increased to 53.6 this month from a reading of 47.6 in February. Analysts had expected the index to rise to 50.0 in March.
The greenback remained under pressure after Federal Reserve Chair Janet Yellen said late Tuesday that global risks to the U.S. economy, including low oil prices and uncertainty over China justified taking a cautious approach to tightening monetary policy.