* Euro flat vs dollar in European trade even after lower
* Short-term safe-haven bids for yen unwound after calm
* IMM data shows long dollar bets pared
* China's yuan weakens after trading band widened over
By Anirban Nag and Patrick Graham
LONDON, March 17 The euro held within sight of
long-term highs against the dollar on Monday, resisting selling
after a dip in euro zone inflation, the latest indicator to
argue for outright money-printing by the European Central Bank
to support growth.
The dollar gained against the yen as European stocks and
U.S. futures headed into positive territory, helped by the lack
of any dramatic further developments in Ukraine after the Crimea
region voted in favour of annexation by Moscow.
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.
The risk of flare-ups in tension between Russia and Ukraine
has underpinned demand for safe-haven currencies like the yen
and the Swiss franc and some of the bets on those currencies
left on ahead of the referendum were unwound on Monday.
"The yen has fallen after the Crimean vote but I would say
many people are going to remain cautious," said Jane Foley, a
currency strategist with Rabobank in London.
"What we don't really know about is what is going to happen
to eastern Ukraine. So people are going to just watch the
The dollar was up 0.45 percent at 101.78 yen, still
within sight of a two-week low of 101.205 yen struck on Friday
and compared to a 1-1/2 month high of 103.77 yen hit on March 7.
The euro was down less than 0.2 percent on the day at
$1.3889, unchanged from morning levels after February
inflation was revised lower. It has traded within about a cent
of a 2-1/2-year high around $1.3967 since last Thursday, when
European Central Bank President Mario Draghi knocked it lower by
voicing concerns about its strength.
"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 Foley.
"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."
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.
Latest data from the Commodity Futures Trading Commission
released on Friday showed that 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.
A record drop in foreign governments' holdings of U.S.
Treasuries led some to speculate that Russia has been reducing
its dollar reserves ahead of possible sanctions from the West.
Investors were also considering the implications of
Beijing's announcement on Saturday that it will double the daily
trading range for the yuan. The step was viewed as a sign of
confidence that the central bank had successfully fought off
"Nothing forced them to widen the band this weekend, so it
will be seen as a continuation of long-term policy," Citi
strategist, Steve Englander wrote in a note. "I would see it as
slightly risk-on. Small positive for the Australian dollar,
small negative for the yen, but again a second-order impact."
The yuan weakened on Monday.