USD Lower, A$ Rallies On RBA Expectations/Minimum Wage Hike

The BBDXY is tracking lower, last close to 1236.40, -0.15% lower versus NY closing levels. The dollar has seen broad based losses, with the index down through Thursday lows. AUD and NZD have outperformed, with the A$ slightly stronger at the margins. Risk appetite has been much stronger in HK/China equities, which has also weighed on USD sentiment.

• AUD/USD is back to 0.6615, +0.65% above NY closing levels. Sell-side names adding RBA rate hikes before and after the 5.75% minimum/wage hike that was announced this morning. This has been a clear support point (see this link). Pricing is slightly above 55% for a 25bps hike next week.
• AUD/NZD firmed in the first part of trade, getting to fresh highs of 1.0866, but we now back at 1.0835/40, as the firmer risk backdrop has seen NZD/USD play catch up. NZD/USD is back above the 0.6100 handle this afternoon.
• The US Senate passed the debt-ceiling legislation. The market impact was minimal. US yields have ticked higher, the 10yr back above 3.61%, (~+2bps). but this hasn't aided USD sentiment.
• USD/JPY sits slightly below NY closing levels, last 138.70/75. Yen has lagged the antipodeans though. BoJ Governor Ueda appeared before parliament, stating that the central bank didn't have a set time frame for achieving to the 2% inflation target.
• Looking ahead, all focus is on the NFP release where Bloomberg consensus looks for further moderation in payrolls growth in May to +195k versus a prior read of +253k.