* Short-term safe-haven bids for yen unwound after calm
* United States, EU impose sanctions on Russia
* Euro firm despite Russia crisis, seen as safe haven
By Gertrude Chavez-Dreyfuss
NEW YORK, March 17 The safe-haven yen fell
broadly on Monday after the United States and the European Union
imposed what investors perceived to be modest economic sanctions
on some officials of Russia and Ukraine following Crimea's vote
to join Moscow over the weekend.
Although investors are not ruling out another flare-up in
tensions between Russia and Ukraine, many do not expect
contagion to major markets. The lack of military conflict
between the two countries has also appeased investors.
Over 95 percent of Crimean voters chose in a Sunday
referendum to join Russia, an outcome denounced by Western
powers and Kiev as illegal and a sham.
As a result, the United States on Monday announced sanctions
on 11 Russians and Ukrainians blamed for Russia's military
incursion into Crimea, including two top aides to Russian
President Vladimir Putin. The U.S. order freezes any assets in
the United States and bans travel to the 11 individuals named as
responsible for the Russian move into Crimea.
The European Union, meanwhile, is to impose sanctions
including asset freezes and travel bans on 21 officials from
Russia and Ukraine after Crimea applied to join Russia on
Monday, Lithuania's foreign minister said.
"The sanctions don't sound particularly aggressive," said
Richard Franulovich, senior currency strategist at Westpac
Securities in New York. "Also some of the worst case scenarios
they were anticipating over the weekend, such as actual military
engagement, did not really materialize."
In mid-morning trading, the dollar rose 0.4 percent against
the yen to 101.76 yen, rising after four days of losses
as investors had bought the safe-haven Japanese currency in the
midst of the Russia-Ukraine crisis.
The euro also gained 0.6 percent to 141.83 yen,
and climbed against the dollar as well to $1.3941,
despite a dip in euro zone inflation, the latest indicator to
argue for outright money-printing by the European Central Bank
to support growth.
Europe's common currency has traded within a cent of a
2-1/2-year high around $1.3967 since last Thursday, when ECB
President Mario Draghi voiced concerns about the euro's
"We have seen some tangible developments on data and from
the ECB that should be negative for the euro yet it hasn't
weakened substantially," said Jane Foley, a currency strategist
with Rabobank in London.
"I think increasingly the euro is exhibiting safe haven
properties. If, for example, money is being herded out of
eastern Europe it is quite feasible that one of the first places
it will go is the euro."
Another safe haven, the Swiss franc, also struggled on
Monday as risk appetite improved. The euro was up 0.1 percent
versus the franc at 1.2152.
FEWER DOLLAR BULLS
The dollar has failed to deliver the strength predicted by
many banks earlier this year, with the euro up four cents from
late January lows.
The latest data from the Commodity Futures Trading
Commission released on Friday showed speculators pared bullish
bets on the dollar for a fifth straight week through March 11,
with net longs falling to their lowest in more than four months.
Overall, though, investors have maintained net long
positions on the dollar for 19 consecutive weeks. The last time
speculators were short the greenback was in late October 2013.