Flight To Safety

Risk-off flows intensified in Asia, with regional equity benchmarks retreating after a sharp reversal in key U.S. stock indices during Thursday's NY session. Looming Fed's policy tightening and underwhelming earnings reports wreaked havoc on Wall Street, while Asia-Pac headline flow offered no consolation. The escalating geopolitical risk surrounding Russia's military activity near the Ukrainian border helped undermine market sentiment.

• Participants rushed into safe havens, generating heavy demand for the yen. USD/JPY retreated past the Y114.00 mark to a fresh one-week low, with talk of JPY purchases against AUD and EUR doing the rounds. The main well-known risk barometer AUD/JPY tumbled below Y82.00 for the first time in a month.
• The yen was unfazed by domestic CPI report, which failed to provide evidence of rising inflation pressures. The key gauge of underlying inflation targeted by the BoJ stayed unchanged, marginally missing expectations.
• The Aussie was the worst performer in G10 FX space, as AUD/USD sank through the $0.7200 figure to erase all of its gains registered in the wake of Thursday's release of strong jobs data out of Australia.
• Weakness in crude oil futures applied additional pressure to commodity-tied FX, after the EIA reported a surprise build-up in U.S. stockpiles.
• UK retail sales & advance EZ consumer confidence headlines today's data docket, with comments coming up from ECB's Lagarde & BoE's Mann.