* Yuan down against dollar and yen
* Yen benefiting more broadly, also helped by Ukraine worries
* U.S. CPI, housing-related data awaited
LONDON, March 18 (Reuters) - The yuan deepened its month of losses against the dollar on Tuesday amid more signs China’s problems with a slowing economy and heavily indebted corporate sector is becoming this year’s big issue for markets.
Reversing one of the past decade’s few sure bets in the foreign exchange market, the yuan is now down more than 2.3 percent in the past month. That move has resumed since officials widened their trading band for the currency over the weekend.
Japan’s yen, which some players in Asia say is now benefiting most strongly amongst major currencies from the yuan’s fall, was up more than half a percent against the Chinese currency, pulling it higher against the dollar.
A survey of 970 global investors by Barclays showed that China’s problems have replaced the U.S. Federal Reserve’s reining in of monetary policy as the biggest concern for market players since the start of 2014.
A trader in Shanghai said he thought the yuan, which is not fully convertible internationally and trades in a complicated system of “offshore” and Chinese “onshore” rates, would head towards 6.2360 against the dollar.
It fell another 0.2 percent to 6.1761 on Tuesday. Much of the play in Asia on the currency, however, has focused on the yen. The Chinese currency was almost half a percent lower against its Japanese counterpart at 16.425.
Dealers say that many of those who were betting strongly on further gains for the yuan are still to be shaken out and that the currency could still go sharply lower in coming weeks.
“There are these structures that everyone talks about and that still holds the potential to take the yuan lower,” said one dealer in London.
There was little change overnight in the situation in Ukraine, which has occupied much of market attention in the past two weeks. The yen was hurt on Monday after Western powers took only minimal steps against Russia over its support for a separatist referendum in Crimea viewed by many internationally as illegal.
On Tuesday, the yen gained 0.4 percent against the dollar in early European trade to 101.35.
“We’ve seen some easing off of the relief rally we saw yesterday but it is going to stay at the top of the market’s list of concerns,” said Lee Hardman, strategist with Bank of Tokyo Mitsubishi-UFJ in London.
“Right now we’re in a kind of stalemate situation and generally we just need to see how it develops. Russia could clearly decide to take reciprocal action at some stage which might for example have knock-on effects for the euro zone.”
With Crimea seemingly set to split from Ukraine, market players are watching eastern Ukraine and the possibility of Moscow’s involvement in the region with a large population of Russian speakers.
Market players said any re-emergence of tensions would support the yen and Swiss franc.
One possible resistance level for the dollar against the yen now lies around 102.30 yen, said Philip Wee, senior currency economist for DBS Bank in Singapore.
The dollar’s 20-day moving average now lies roughly around 102.30 yen, while the 100-day moving average comes in slightly above that level, around 102.38 yen.
Against the Swiss franc, the dollar traded at 0.8733. The dollar had hit a 2-1/2-year low of 0.8698 against the Swiss franc last week on trading platform EBS, but has since pulled up from that trough as investor risk aversion ebbed.
The dollar index, a measure of the greenback’s value against six major currencies, was at 79.402, above a four-month low of 79.268 hit last week.
Investors will watch the U.S. consumer price index and housing-related dated due later in the session for clues to the dollar’s likely direction.