* Short-term safe-haven bids for yen unwind
* United States, EU impose sanctions on Russia
* Euro firm despite Russia crisis, seen as safe haven
By Gertrude Chavez-Dreyfuss and Michael Connor
NEW YORK, March 17 The safe-haven yen fell
broadly on Monday after the United States and the European Union
imposed what investors saw as modest economic sanctions against
Russia and Ukraine following Crimea's weekend vote to join
The dollar, often a shelter for investors against global
stresses, was also down, with the dollar index, a measure
of the greenback's value against six major currencies, off 0.13
percent to 79.345 in afternoon trading.
"The market thinks, it's not so bad," said Joseph Trevisani,
chief market strategist at WorldWideMarkets Online Trading in
Woodcliff Lake, New Jersey. "You don't see any signs of play
against the euro. If the sanctions were serious, say against
Russia's oil and gas exports, you'd see selling of the euro
because they don't have much alternative for energy."
Although investors are not ruling out another flare-up in
tensions between Russia and Ukraine, many do not expect
contagion in major markets. The absence of military conflict
between the two countries 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. 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, will impose sanctions
including asset freezes and travel bans on 21 officials from
Russia and Ukraine after Crimea applied to join Russia on
"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 late New York trading, the dollar was up 0.3 percent
against the yen at 101.66 yen, rising after four days of
losses driven by investors buying the safe-haven Japanese
currency in the midst of the Russia-Ukraine crisis.
The euro also gained 0.5 percent to 141.51 yen,
and climbed against the dollar as well to $1.392, despite
data showing 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 0.2 percent
versus the franc at 1.2159.