The safe-haven yen hit a near three-week high and the euro and riskier currencies fell on Tuesday as Russia ordered troops into breakaway parts of eastern Ukraine and the region stood on the brink of war.
The yen JPY=EBS edged about 0.2% higher to 114.50 to the dollar early in the Asia session and the euro EUR=EBS dipped about 0.1% to a one-week low of $1.1297. The Swiss franc CHF=EBS , another safe-haven, hit a one-month high overnight.
"It is remarkably restrained...but in these circumstances risk metrics are the driving force," said NAB head of foreign exchange strategy, Ray Attrill.
Russian President Vladimir Putin recognised two breakaway regions in eastern Ukraine as independent on Monday and ordered the Russian army to launch what Moscow called a peacekeeping operation into the area.
It was not immediately clear whether action was the start of an invasion of Ukraine that the United States and allies have warned about for weeks, but the West has begun to respond by preparing sanctions.
The Russian rouble RUB= tanked more than 3% against the dollar on Monday and extended its slide on Tuesday, edging about 0.3% lower to a 15-month low of 80.3930 to the dollar. Ukraine's currency UAH= fell more than 1% on Monday.
The risk-sensitive Australian and New Zealand dollars traded under pressure, but kept within recent ranges as analysts said commodity prices and a market already positioned heavily short Aussie dollars limited losses.
The Australian dollar AUD=D3 was last down about 0.1% at $0.7182.
"The sharp sell-off in Russian assets is a stark reminder that tension remains super high and risk sentiment is being hit across equity, credit and bond markets," Westpac analysts said in a note.
"However, the commodity story remains super supportive though and we are in the middle of miner dividend season meaning that we are likely set for more rangy price action around $0.72."
The kiwi NZD=D3 marginally softer at $0.6695 and sterling GBP=D3 was down about 0.1% to $1.3590.
The U.S. dollar index =USD held at 96.083. Cryptocurrencies were under pressure, with bitcoin BTC=BTSP sitting near Monday's near three-week low at $37,112.
======================================================== Currency bid prices at 0021 GMTDescription RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR=EBS $1.1315 $1.1311 +0.04% +0.00% +1.1316 +1.1297 Dollar/Yen JPY=EBS 114.5600 114.8200 -0.24% +0.00% +114.6400 +114.5500 Euro/YenDollar/Swiss CHF=EBS 0.9156 0.9157 +0.00% +0.00% +0.9161 +0.9157 Sterling/Dollar GBP=D3 1.3593 1.3603 -0.07% +0.00% +1.3599 +1.3582 Dollar/Canadian CAD=D3 1.2756 1.2750 +0.04% +0.00% +1.2766 +1.2753 Aussie/Dollar AUD=D3 0.7185 0.7189 -0.03% +0.00% +0.7190 +0.7172 NZ NZD=D3 0.6699 0.6701 -0.03% +0.00% +0.6700 +0.6681 Dollar/Dollar All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX
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