* Yen takes a breather as uncertainty over Bernanke recedes
* Demand for high-yielders and euro still shaky
* Investors remain cautious about Obama's bank plan
By Kaori Kaneko
TOKYO, Jan 25 (Reuters) - The yen and the dollar dipped on
Monday while the euro and high-yielding currencies advanced,
lifted by reports that Ben Bernanke was moving closer to being
confirmed for a second term as chairman of the Federal Reserve.
Resilience in Chinese shares <> and U.S. stock futures
<DJc1> <SPc1>, after a 2 percent fall on Wall Street on Friday,
also encouraged investors to buy back some currencies, such as
the Australian dollar, which were sold off heavily last week.
Markets have been fretting since late last week over whether
Bernanke would be approved for the job. []
Several key senators had announced their opposition to
Bernanke's reappointment, spooking investors already unnerved by
President Barack Obama's plans to limit risk-taking by banks. But
the Fed chief edged closer to winning support after the Senate's
Republican leader predicted he would be confirmed.
[].
Still, demand for riskier assets and higher-yielding
currencies is likely to remain subdued amid rising concerns over
Greece's fiscal problems, worries that China's efforts to curb
its surging economy may impair global growth and fears that White
House plan could impact U.S. bank earnings.
"The timing (of Obama's plan) is extremely bad. It could ruin
gains in share prices further, which was a core reason why the
smooth global recovery was possible," said Kosuke Hanao, head of
treasury product sale at HSBC in Tokyo.
"Falls in share prices, if they are extended, could dampen
consumer spending and employment. The negative impact would not
stop at Wall Street but could spread into the economy as a
whole," Hanao said.
The dollar rose 0.3 percent to 90.06 yen <JPY=> after falling
as low as 89.71 yen on trading platform EBS in early Asian trade,
its lowest since late December.
The euro climbed 0.4 percent to 127.57 yen <EURJPY=R>, off a
nine-month low of 126.55 yen hit on EBS last Friday.
The Australian dollar was trading at 81.60 yen <AUDJPY=R>,
right on its 100-day moving average, after hitting 80.75 on
Friday, its weakest in nearly a month.
Data showed that Japanese margin traders nearly doubled their
overall net long positions in dollar/yen and six major cross/yen
pairs on Friday, taking advantage of the gaining yen.
A big part of those increases in net long positions came
after investors shed gross short positions in Aussie/yen and
dollar/yen.
The retail traders also slightly increased their record net
long positions in euro/yen on Friday, despite the euro's slide.
See http://link.reuters.com/wyb27g
The dollar index <.DXY> <=USD> was down 0.1 percent at 78.18,
below a 4-1/2-month high of 78.814 touched last week.
The euro rose 0.2 percent to $1.4165 <EUR=>, although traders
said the single currency was unlikely to run much higher with its
200-day moving average at $1.4315 expected to provide resistance.
Among higher-yielding currencies, the Australian dollar
advanced 0.8 percent to $0.9069 <AUD=D4> and the New Zealand
dollar also climbed 0.9 percent to $0.7163 <NZD=D4>.
Still, the U.S. dollar could get a boost from some important
events lined up this week, analysts said.
The Federal Reserve's first interest rate meeting of the year
will be held on Tuesday and Wednesday.
The Fed is widely expected to keep rates on hold near zero,
although it may sound more optimistic about an economic recovery.
Fourth-quarter U.S. gross domestic product numbers are due on
Friday and a Reuters poll of economists suggests the economy grew
at 4.5 percent, its fastest pace of growth in nearly four years.
[]
(Additional reporting by Masayuki Kitano and Satomi Noguchi;
Editing by Michael Watson)
