* Yen rises after U.S.'s Kerry hints response on Crimea vote
* Euro retreats from 2-1/2 year highs vs U.S. dollar
* Kiwi rallies on rate hike, jobs data boosts Aussie
By Richard Leong
NEW YORK, March 13 The yen rose against the euro
and dollar on Thursday after U.S. Secretary of State John Kerry
signalled a possible response from the West if a referendum in
Ukraine's Crimea region goes ahead on Sunday.
Kerry's comments before Congress, together with a warning by
Ukraine's acting president Oleksander Turchinov of a possible
Russian invasion, rekindled fears of a war breaking out in the
region. This led anxious investors to dump stocks and risky
assets in favor of the yen, Swiss franc and other perceived
"You saw a bid for yen on Kerry's comments. It crystallizes
the idea that on Monday there could a serious response," said
Lou Brien, market strategist with DRW Trading in Chicago.
The United States and the European Union will respond on
Monday with a "serious series of steps" against Russia if a
referendum in Ukraine's Crimea region goes ahead on Sunday,
Kerry told a congressional hearing.
Ukrainian acting president Turchinov told a local television
station Russian forces were concentrated on the border "ready to
invade," but he believed international efforts could end
Moscow's "aggression" and avert the risk of war.
The yen was up nearly 1 percent against the dollar at 101.75
yen after hitting a one-week high at 101.70 in midday
U.S. trading. It gained 0.9 percent versus the euro at 141.53
yen after touching a one-week peak.
Safe-haven bids also benefited the Swiss franc, which
reached a near 2-1/2-year high versus the greenback at 0.8731
franc. It strengthened 0.2 percent against the euro at
The euro turned flat against the dollar, last at $1.3904.
Earlier, gains propelled the common currency to a 2-1/2-year
high against the greenback. Escalating conflict in Crimea and
possible ripple effects on Europe overshadowed optimism that the
region has put recession and its debt crisis behind.
KIWI, AUSSIE REBOUND
Among other major currencies, the New Zealand and Australian
dollars surged before worries about Ukraine reduced their gains.
The kiwi had risen to its strongest against the dollar in 10
months after the New Zealand central bank hiked interest rates,
and signalled more to come, as its economy has gained traction.
Surprisingly strong employment data lifted the Aussie by more
than 1 percent against the greenback.
The kiwi and Aussie currencies suffered earlier this week on
a dramatic selloff in copper and other commodities due to
growing concerns over the Chinese economy, a major driver of
demand for Australia's huge mining sector.
The latest Chinese economic data was lukewarm at best.
Industrial output missed market expectations, and growth in
retail sales also fell short of forecasts.
"The numbers out of China were not impressive by all means,
but it was not bad enough for players to create big fresh 'risk
off' positions - thus currency reaction was limited," said a
trader at a large Japanese bank in Tokyo.
Earlier the Reserve Bank of New Zealand (RBNZ) delivered a
widely expected interest rate hike and flagged that a further
100 basis points of tightening was possible this year.
That pushed the New Zealand dollar up to $0.8607,
its highest since May 2013 before easing to $0.8552, up 0.3
percent on the day. The kiwi turned weaker against the yen at
87.05 after setting fresh six-year high earlier.
"Today's communication strongly suggests the RBNZ will be on
the front foot for the next few meetings," Michael Turner,
strategist at RBC in Sydney, said.
In the meantime, the Australian government reported 47,300
jobs were created in February, more than double market
The Aussie was last up 0.6 percent at $0.9040
halving its earlier gain against the U.S. dollar.