AUD/JPY advances above 93.00 due to easing US-China trade tensions

• AUD/JPY is gaining strength, supported by improving market sentiment and easing trade tensions between the US and China.
• Australian Retail Sales rose by 0.3% month-on-month in March, slightly below the expected 0.4% increase.
• The Japanese Yen continues to weaken as safe-haven demand declines amid growing optimism over US-China relations.

AUD/JPY is on track for its third consecutive day of gains, hovering around the 93.20 level during the Asian session on Friday. The currency cross is buoyed by strength in the Australian Dollar (AUD), supported by improving market sentiment and easing US-China trade tensions--an encouraging sign for Australia, given its strong economic ties with China.

According to Bloomberg, China is considering renewed trade talks with the US. The Chinese Commerce Ministry noted that Washington has reached out to express interest in resuming negotiations. However, China is reportedly conducting an internal assessment and maintains that the US should correct its tariff-related actions, which it views as the unilateral trigger for the ongoing trade dispute.

On the domestic front, Australian Retail Sales rose 0.3% month-over-month in March, according to data from the Australian Bureau of Statistics (ABS). While this marked a decline from February's revised 0.8% (previously 0.2%), also came in below the market consensus of a 0.4% increase.

Meanwhile, the Japanese Yen (JPY) remains under pressure due to a decline in safe-haven demand amid optimism surrounding US-China relations. Japan and the US also wrapped up a second round of bilateral trade talks this week, with Tokyo aiming to finalize a deal by June.

In economic data, Japan's unemployment rate ticked up to 2.5% in March, though labor market conditions remain tight. Separately, the Bank of Japan (BoJ) kept its policy rate unchanged at 0.5% on Thursday and cut its growth and inflation outlooks, signaling limited prospects for rate hikes in the near term.