Yen eases but up for week as investors stay worried over Ukraine tensions

  • After rallying this week, some safe-haven currencies drop
  • Analysts say market direction tied to Ukraine crisis
  • U.S. dollar index higher

NEW YORK, Feb 18 (Reuters) - The safe-haven Japanese yen fell slightly against the dollar on Friday, pulling back after recent gains, but was up for the week as a series of developments in the Ukraine-Russia crisis put investors on edge.

In afternoon New York trading, the dollar was up 0.1% at 115.025 yen . For the week, the dollar was down 0.4% against the Japanese currency in its biggest weekly percentage decline in about a month. Against the Swiss franc - another safe haven - the dollar was up 0.1% at 0.9212 francs .

Concerns about a possible Russian invasion of Ukraine also have boosted demand for safe-haven bonds, with Treasury yields dropping on Friday.

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On Friday, Russian-backed separatists in eastern Ukraine said they planned to evacuate their breakaway region's residents to Russia, while U.S. Secretary of State Antony Blinken said the events transpiring in the border area over the past two days are part of a Russian scenario to create false provocations. read more

News late on Thursday that Blinken had accepted an invitation to meet with Russian Foreign Minister Sergei Lavrov late next week gave some relief to investor jitters.

"Everyone is fixated over what's happened with the Ukraine situation. There's a tremendous amount of nervousness. Everyone is hoping for some type of deescalation but it just doesn't seem like that is the direction things are going," said Edward Moya, senior market analyst, at Oanda in New York.

"The trade has been about safe havens, and it's been a great week for the Japanese yen. Today the yen is slightly softer but the overall concern right now is you're entering the long weekend, and you still have a lot rhetoric coming out of Russia," he said.

The Russian rouble weakened 1.26% versus the greenback at 77.40 per dollar.

The euro was down 0.3% against the dollar at $1.1329, while the U.S. dollar index was up 0.3%.

Bitcoin last fell 1.3% to $40,025.

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Currency bid prices at 3:20PM (2020 GMT)

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Additional reporting by Tommy Wilkes Editing by Gareth Jones, Tomasz Janowski, Christina Fincher and Sandra Maler

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