Positive Risk Sentiment Rubs Salt Into Yen's Wounds, Kiwi Extends Gains

The yen extended losses and is on the course for finishing the week as the worst G10 performer. Positive risk appetite from Thursday's NY session spilled over into Asia, while a BBG report noting that China is easing mortgage rules kept sentiment buoyant. Continued equity gains and further increase in commodity prices conspired with Gotobi Day flows to sap some strength from the yen.

• USD/JPY was bought into the Tokyo fix, punching through multi-year highs printed earlier this week. The rate topped out at 113.45, its highest point since Nov 28, 2018.
• BBG trader sources cited USD/JPY purchases by short-term leveraged accounts amid lack of resistance from option desks and local exporters.
• NZD maintained Thursday's pole position in G10 FX space after BusinessNZ PMI report showed that New Zealand's manufacturing sector returned into expansion in September, following a sharp contraction recorded in the prior month.
• Mind that the details of New Zealand's PMI report were not all positive, as recovery remained uneven between regions, while the proportion of negative comments from respondents remained relatively high.
• AUD/NZD sales weighed on the broader AUD, despite positive risk backdrop. The Antipodean cross retreated, swinging into a weekly loss.
• U.S. retail sales, Empire M'fing & Univ. of Mich. Sentiment will hit the wires later today, alongside final French and Italian CPIs. Comments are due from Fed's Williams & Bullard.