* Demand for safe-haven yen rises as China data disappoints
* China investment, factory output, retail sales miss forecasts
* Upbeat U.S. data helps underpin dollar index
By Ian Chua
SYDNEY, May 16 (Reuters) - The yen was broadly firmer early on Monday after disappointing economic news out of China shored up demand for the safe-haven currency.
Chinese investment, factory output and retail sales all missed forecasts, adding to doubts about whether the economy is stabilising. greenback touched a low of 108.46 yen JPY= , retreating from two-week highs of 109.57 set on Friday. The common currency fell as far as 122.625 yen EURJPY=R , extending its pullback from last Thursday's peak of 124.65.
The Australian dollar, often used as a liquid proxy for China plays, dipped to its lowest in more than two months at $0.7249 AUD=D4 . Versus the yen, the Aussie touched a low of 78.58 AUDJPY=R , well off last week's peak of 80.65.
"The weekend's softer Chinese data will see commodity currencies start the week under pressure in an environment where a pickup in U.S. data had already put them on the back foot," analysts at ANZ wrote in a note to clients.
Indeed, figures on Friday showed U.S. retail sales rose 1.3 percent last month, their biggest increase in a year.
The upbeat figures suggested the U.S. economy was regaining momentum and came after comments from several Federal Reserve officials revealed growing pressure within the central bank to raise rates in the coming months. data was a fillip for the greenback on Friday, driving the dollar index .DXY to its highest since April 25. It last stood at 94.629, not far from the peak of 94.845.
The index has gained nearly 3 percent from the May 3 trough of 91.919 in two weeks.
The greenback was at two-week highs against both the euro and sterling. The common currency fetched $1.1316 EUR= , having been as low as $1.1283 on Friday. The pound traded at $1.4353 GBP=D4 , near a two-week low of $1.4340.
Yet, U.S. Treasury yields failed to rise on the data.
The 10-year yield perversely fell to a one-month low 1.70 percent US10YT=RR on Friday, suggesting debt investors were reluctant to price in higher rates against a global backdrop of low inflation and low growth.
With little in the way of market-moving economic data due out of Asia, traders expect the major currencies to consolidate. Liquidity is also likely to be dampened on Monday as several European centres are closed for the Whit Monday holiday.