FOREX-Dollar off highs, yen slips on economic concerns

* Dollar slips vs some major currencies after Monday's gains

* Yen falls on crosses as economic worries weigh

By Kaori Kaneko

TOKYO, March 10 (Reuters) - The dollar fell against the euro and other major currencies on Tuesday, retracing some of the previous day's steep gains, while the yen slipped across the board amid worries about Japan's economy.

The U.S. currency gained steeply against the pound in particular on Monday as worries about global recession and the financial sector sent investors looking for a safe haven.

But on Tuesday it pulled back from its highs as investors paused to assess the risk outlook, as Asian share markets showed a mixed picture and S&P futures .SPX indicated a firmer start on Wall Street later.

"It is hard to think that stocks will turn to an upward trend given the credit situation. The dollar is likely to retain its safe-haven status," said Kazuyuki Kato, treasury department manager at Mizuho Trust and Banking Co.

"But since gains in the dollar have progressed to a considerable degree, the currency will face its peak at some level," he said.

The euro advanced 0.2 percent to $1.2637 EUR=. It touched a three-month low of $1.2457 last week. The single currency also climbed 0.3 percent to 124.97 yen EURJPY=R.

Sterling rose 0.3 percent to $1.3815 <GBP=D4. It fell 2 percent to its lowest in more than a month on Monday, at $1.3741 GBP=, as banking sector worries intensified after Lloyds Banking Group (LLOY.L) said the UK government was taking a stake of up to 77 percent.

Sterling gained 0.4 percent to 136.64 yen GBPJPY=R, and the Australian dollar jumped 1 percent to 63.01 yen AUDJPY=R.

Dealers said concerns about the Japanese economy had been fuelled by data showing its current account swung into deficit in January.

The dollar held steady against the yen at 98.97 yen JPY= although it was below a recent four-month peak at 99.69. (Editing by Hugh Lawson)