* U.S. July CPI sends dollar lower against the yen

* Euro pressured on the day EUR=

* EZ July inflation falls slightly more than first estimate

* Aussie dollar hits 11-month high vs U.S. dollar

The yen extended gains against the euro and the U.S. dollar after a report showed U.S. consumer prices were flat in July over June but fell over the past 12 months by the most since 1950.

Though the data left the euro pressured against the dollar, investors bought yen after the CPI report send U.S. stock futures lower on lower risk tolerance. The trend to risk aversion was apparent earlier in the day when Chinese shares fell 3.0 percent to their lowest close in six weeks.

Dollar/yen has been biased to the downside all night and this morning so I think that's a continuation of the trend, said Omer Esiner, senior market analyst at Travelex Global Business Payments in Washington.

Early in New York, dollar was down 0.6 percent at 94.76 yen.

It was on track for a 3.0 percent fall on the week at current prices. The euro EURJPY=R fell 0.4 percent to 135.80 yen, and was down 2.2 percent for the week.

The yen's gains were also attributed to potential fund repatriation by Japanese investors related to some $57.5 billion in redemptions and coupon payments on U.S. Treasuries next week, said Lee Hardman, currency economist at Bank of Tokyo-Mitsubishi UFJ in London.

The euro was down 0.1 percent at $1.4275 EUR=, after hitting a session high of $1.4306. Analysts say a recent high of $1.4448 would likely remain firm resistance.

Markets showed little reaction to a 0.7 percent fall on the year in euro zone inflation in July, compared with an initial estimate of -0.6 percent.

That came after data the previous day showed the French and German economies both unexpectedly grew on the quarter in April-June.

The Australian dollar hit an 11-month high against the U.S. dollar earlier in the day after Reserve Bank of Australia Governor Glenn Stevens said that a normal interest rate would be well above the current rate of 3.0 percent.

It was last trading flat on the day at $0.8422 AUD=D4.

The New Zealand dollar rose 1.1 percent and touched its highest since September 2008. It last traded at $0.6854.

The rise came after New Zealand's retail sales rose for the first time in nearly two years in the June quarter and the housing market showed more signs of stabilising, backing views of a gradual recovery and that rates will remain on hold in the coming months.

Investors now await readings of U.S. industrial production and consumer sentiment later in the day to better gauge whether the economy is improving.

A stronger-than-expected reading in industrial output is unlikely to be quite as positive for the dollar as the payrolls surprise but could support risky assets and currencies, said analysts at Barclays Capital in a note. (Additional reporting by Wanfeng Zhou in New York and Tamawa Desai in London) (Reporting by Nick Olivari)

Inflation