FOREX-Dollar climbs as Russia backs reserve currency role
* Russia's Kudrin voices confidence in U.S. dollar
* Euro zone worries help push euro below $1.38 vs dollar
* Data shows slump in U.S. factory sector, capital outflows
* Euro zone banks could face further $283 bln in writedowns (Updates prices, adds quotes)
By Gertrude Chavez-Dreyfuss
NEW YORK, June 15 (Reuters) - The dollar gained broadly on Monday as Russia expressed confidence in the greenback as the world's reserve currency, while concerns about the euro zone economy undermined the euro.
Russia's remarks outweighed data showing a slump in New York state's factory sector in June and a net capital outflow from the United States in April.
"We saw a lot of dollar-supportive comments from the G8 finance ministers' meeting, starting with Kudrin," said Sebastien Galy, currency strategist at BNP Paribas in New York.
Speaking on the sidelines of a Group of Eight finance ministers in Italy, Russia's Alexei Kudrin said the dollar's role as the world's main reserve currency is unlikely to change in the near future. [ID:nFCA000184]
This boosted the dollar, alleviating concerns that major emerging market countries may be diversifying their reserves away from the dollar ahead of a summit of leaders of Brazil, Russia, India and China (BRIC) in Russia on Tuesday.
The International Monetary Fund on Monday also threw its support behind the U.S. unit, saying the dollar's status as the world's dominant reserve currency is likely to remain. See [ID:nWBT011368].
"Some people have sold the dollar as a result of chatter about diversification away from the U.S. dollar. Now that the finance ministers are standing by the dollar, people are starting to buy the dollar again," UBS currency strategist Brian Kim said.
In midday New York trading, the ICE Futures' dollar index, a gauge of the greenback's value against a basket of major currencies, rose 1.4 percent to 81.244 .DXY.
EURO WOES
The euro fell to $1.3774 against the dollar on electronic trading platform EBS EUR=EBS, the lowest in more than three weeks, as investors worried about persistent weakness in the euro zone. The euro last traded at $1.3788, down 1.7 percent.
The single euro area currency also fell sharply against the yen to 134.93 EURJPY=EBS, a roughly two-week low. It was last at 135.01 yen, down nearly 2 percent from late on Friday. Continued...


