* Euro off 1-year highs; Aussie, kiwi fall vs U.S. dollar
* Waning risk appetite helps dollar's safe-haven appeal
* Dollar hits day's high vs yen after Japan Fujii's comments
* Stg dips as Lloyds' news fans financial sector jitters
(Updates prices)
By Emelia Sithole-Matarise
LONDON, Sept 18 (Reuters) - The dollar rose against most
major currencies on Friday, clawing off a one-year low against
the euro as waning risk appetite cut demand for higher-yielding
currencies, giving the bruised greenback some respite.
The dollar has retreated broadly since March as investors
shifted into riskier assets due to increasing signs the global
economy is on the mend, and it extended its losses this week as
equities and commodities rallied.
The U.S. currency gained some reprieve on Friday as global
equities fell and investors trimmed their positions ahead of
holidays in Japan and Singapore next week, although the trend
for broad dollar weakness was seen as likely to persist.
"It's a risk-driven move for now. Overnight equities didn't
perform as well. That is obviously weighing on markets for now.
It remains to be seen whether that is sustained," said Geoffrey
Yu, currency strategist at UBS in London.
"It's possible on Friday people are taking profits. It's too
early to tell whether it marks the beginning of a trend because
there's been no notable catalyst for now but if things do pick
up again up ahead, as in outflows from risk markets pick up,
then it may mark the start of something more significant."
The euro dipped 0.2 percent from late U.S. trading on
Thursday to $1.4705 <EUR=> by 1126 GMT. It hit a one-year high
of $1.4768 on trading platform EBS on Thursday, and has risen
more than 2.5 percent so far this month.
European <> shares slipped from an 11-month peak hit
the previous session as recent sharp gains prompted investors to
book profits.
The dollar index, which measures the dollar's value against
a basket of six major currencies, rose 0.3 percent to 76.455
<.DXY>, having bounced off Thursday's one-year low of 76.010.
"We've obviously had a fairly big move. There's not much in
terms of news or catalyst to drive the market further ... It's
just time for a period of consolidation after some big moves,"
said Derek Halpenny, European head of currency research at Bank
of Tokyo Mitsubishi UFJ in London.
Data showing German August producer prices rose by 0.5
percent month-on-month, beating forecasts for a 0.2 percent
rise, had little effect on the market. []
Comments by Russian Prime Minister Vladimir Putin that there
was no threat to the United States from many reserve currencies
also had little immediate effect. []
YEN PULLS BACK, STERLING SLUMPS
Against the yen, the dollar rose as high as 91.47 yen <JPY=>
according to Reuters data, after Japanese Finance Minister
Hirohisa Fujii said he did not want to be perceived as backing a
strong yen. [] It was last up 0.3 percent at 91.36
yen, having rebounded from a seven-month low of 90.12 yen hit on
Wednesday.
Sterling hit a four-month low against the euro of 90.00
pence <EURGBP=D4> on news the UK had set tougher-than-expected
conditions to the potential exit of Lloyd's Bank from a
state-run scheme to protect its assets.
Britain's Lloyds Banking Group <LLOY.L> said on Friday it
was weighing alternatives to the scheme to insure it against
credit losses [].
Sterling also slumped 0.5 percent to $1.6348 <GBP=>.
The Australian dollar <AUD=D4> fell 0.4 percent to $0.8683,
down from a 13-month high of $0.8776 hit on Thursday. The New
Zealand dollar was little changed around $0.7093 <NZD=D4>, off a
13-month high of $0.7159 hit on Thursday.
(Additional reporting by Tamawa Desai; Editing by Andy Bruce)
