SYDNEY, April 29 (Reuters) - The Australian and New Zealand dollars climbed to their highest in more than a decade against the weakened Japanese yen on Monday as a still dovish Bank of Japan supercharged bears in a market thinned by holidays.

Diverging interest rate outlooks in Australia and New Zealand also sent the Aussie to a 10-month high against the kiwi, as traders waited for the latest economic data releases to glean more clues on policy direction.

The Aussie surged 1.1% to 104.58 yen, the highest since 2013, after jumping 1.9% on Friday. It faces major resistance at the 2013 high of 105.45 yen.

The demand from carry trades - where investors borrowed the Japanese yen to buy higher-yielding currencies - helped the Aussie gain for a fifth straight session against the dollar. It rose 0.5% to $0.6565, and cleared a key hurdle at the 200-day moving average of $0.6525.

The kiwi dollar also jumped 1% to 95.00 yen, the strongest level since 2007, after surging 1.6% on Friday. Against the greenback, it rose 0.5% on Monday, on top of a 0.8% gain last week.

In the broader foreign exchange market, the yen slid past the 160 per dollar level after the Bank of Japan kept policy settings unchanged on Friday but failed to signal any meaningful concern about the rapid descent of the currency.

Low liquidity in the market due to the public holidays in Japan could exacerbate moves in the yen, but the expectation is for the Australian dollar to extend its gains this week, said Joseph Capurso, head of international economics at the Commonwealth Bank of Australia.

"Nevertheless, the widespread sharp falls in the JPY have raised the risk of a FX intervention by Japan's Ministry of Finance that can pull AUD/JPY down sharply."

Elsewhere, traders are looking ahead to Australia's retail sales figures on Tuesday, which have gained some prominence after a surprisingly hot inflation report last week decimated any chance of policy easing this year.

Analysts tipped sales likely rose 0.2% last month but any unexpected strength will add to the case that monetary policy may not have been restrictive enough. Swaps are implying a 50% probability of another interest rate rise from the Reserve Bank of Australia by September.

In New Zealand, the jobs report, due on Wednesday, is expected to show the labour market continued to loosen with unemployment rate ticking up to 4.2% in the first quarter from 4.0% previously, paving the way for rate cuts later in the year.

The Aussie dollar also climbed to NZ$1.1010 on Monday, the strongest since June 2023. (Reporting by Stella Qiu; editing by Miral Fahmy)