TOKYO (Reuters) -The Australian dollar led gains against the U.S. dollar on Friday amid signs of a possible thaw between the United States and China on trade talks, while the euro edged higher.

The risk-sensitive Aussie and kiwi dollars climbed as Asian shares carried on a rally on Wall Street. China's offshore yuan strengthened to a near one-month high.

The U.S. dollar was still on track for a third straight weekly advance. The greenback, U.S. Treasuries and shares have bounced from steep declines last month as President Donald Trump's erratic tariff policies drove fears of a recession and sapped confidence in U.S. assets. 

"The dollar was hit so badly in the immediate aftermath of the tariffs, so now in the broad picture there's a normalisation in the market," said Alvin Tan, an independent currency analyst based in Singapore.

"The market is keeping one eye on the economic situation, but the other eye is looking for positive developments in China," he added.

U.S. Secretary of State Marco Rubio told Fox News late on Thursday that talks with China will come up soon. His comments came on the heels of a Chinese state media report seen as a signal of Beijing's openness to trade negotiations.

Beijing is "evaluating" an offer from Washington to hold talks over Trump's tariffs, China's Commerce Ministry said on Friday. 

Australia's dollar rose 0.5% to $0.6412, and New Zealand's kiwi dollar added 0.4% to $0.5932. The currencies often act as liquid proxies for the tightly-managed yuan because of the Antipodean nations' close trade ties with China.

The offshore yuan touched 7.2519 per U.S. dollar, the strongest since April 4. Mainland China markets were closed for a long holiday.

U.S. stocks rose on Thursday, driven by positive tech earnings and a slightly better-than-expected manufacturing report even though it showed factory activity contracted further last month.

The dollar index dipped 0.2%, still poised for a 0.3% gain in a week of relatively light trading due to holidays.

The greenback traded at 145.17 yen, after earlier touching 145.91, the strongest since April 10. The yen sank on Thursday after the Bank of Japan left interest rates on hold and lowered growth forecasts due to U.S. tariffs, essentially signaling a pause in rate hikes for more clarity on the fallout from the trade measures.

The euro edged up 0.2% to $1.1317 from near a three-week low. 

Market participants are now looking to the nonfarm payrolls report for an indication on when the Federal Reserve will resume cutting rates. Wall Street economists are forecasting 130,000 new jobs created last month, compared with a print of 228,000 seen in March.

"Our view is that the FOMC needs time and more data to assess the impact of tariffs on inflation," ANZ analysts said in a note to clients. 

"As long as the labour market holds up, the FOMC will focus on inflation."