* Yen shrugs off Tokyo April CPI
* Euro recovers from low hit on Draghi comments
* Danish crown retreats from near three-month high
(Updates prices, adds fresh comment)
By Anirban Nag
LONDON, April 25 The safe-haven yen and Swiss
franc rose to near one-week highs against a struggling dollar on
Friday as deepening concerns about Ukraine outweighed optimism
about U.S. economic growth.
The dollar stood at 102.19 yen, not far from
Thursday's one-week low of 102.085 at the end of a lacklustre
week against the yen. It was down 0.1 percent against the Swiss
franc at 0.8809 francs, having fallen to a one-week low
of 0.8802 earlier in the day.
With tensions between Ukraine and Russia high, Ukrainian
special forces launched a second phase of their operation in the
east of the country on Friday, an official on the presidential
staff said. Ukraine's forces killed up to five pro-Moscow rebels
"There has been a slight boost in risk aversion which is
supporting the yen," Credit Agricole FX strategist Manuel
"But geopolitical risks are not having too much of an impact
on currencies with most investors still focused on growth
prospects. If risk sentiment improves, the yen will be sold
off," he said.
The yen showed limited reaction to Japanese consumer price
data, with core CPI rising 2.7 percent in the Tokyo area, below
economists' forecast of 2.8 percent.
As the impact of a consumption tax hike is estimated to have
boosted the reading by 1.7 percentage points, the data suggested
inflation has been essentially flat from March, when it rose 1.0
percent. Many investors expect Japan's inflation to ease later
this year, prompting more policy easing from the Bank of Japan.
"As such, this takes us a small step closer to another
tranche of BoJ easing, but we still think the BoJ will want to
see at least some evidence of the impact on activity as well as
prices before acting," said Adam Cole, head of G10 FX strategy
at RBC Capital.
"We expect no policy action at the BoJ meeting next week."
BoJ governor Haruhiko Kuroda has said inflation is firmly on
a path to reach its targeted 2.0 percent. His view has somewhat
weakened expectations of an immediate easing, helping to support
Concerns over a wider conflict between the West and Russia
overshadowed a brightening economic picture in the United
States. March U.S. durable goods orders rose 2.6 percent, above
economists' forecast of 2 percent.
The euro inched up to $1.3845, having recovered from
Thursday's low of $1.3791 hit after European Central Bank
President Mario Draghi reiterated the potential for asset
purchases to ward off deflation risks. He warned that a rising
euro could force the ECB's hand on monetary policy measures.
In the European session, volumes in euro/Danish crown trades
picked up for a second day, according to Reuters Matching. The
euro recovered from a near three-month low against the crown
of 7.4614 to trade at 7.4647 crowns.
The crown had soared after the Danish central bank surprised
the market by raising the rate on certificate of deposits and
ending a regime of negative interest rates in a bid to stem
outflows and support the currency.
(Additional reporting by Masayuki Kitano in Singapore; Editing
by Louise Ireland, John Stonestreet)