FOREX-Dollar steps back from 2-week high, emerging markets in focus
* USD gains from huge unwind in emerging mkt, commodities
* Yen, Swiss franc may gain on more emerging mkt turbulence
* Eyes on Asian FX, shares after falls on Wall St, Europe
* Mkt anxiously watches PBOC clampdown in China money mkts
TOKYO, June 21 (Reuters) - The U.S. dollar stepped back from a two-week high against a basket of developed world currencies and is seen on solid footing against especially emerging currencies on expectations of an eventual end to super-easy U.S. monetary policy.
There is concern that higher U.S. interest rates will prompt a mass migration out of emerging markets. If that trend intensifies, it could favour traditional safe-haven currencies such as the yen and the Swiss franc, market players said.
"It's become clear the Fed is heading for an exit from stimulus. The era of 'Bernanke puts' is over. Those who are doing dollar-carry trades and buying emerging market assets have to unwind their positions," said Mitsuru Saito, chief economist at Tokai Tokyo Securities.
Against a basket of major currencies the dollar was off a shade at 81.667, below Thursday's two-week high of 82.145, though it was still up 1.3 percent for the week.
The euro was holding at $1.3234, having backtracked form Wednesday's four-month peak of $1.3414.
Neither had the dollar made much progress on the yen, which could turn higher once more should Tokyo shares take a dive.
After making a brief top at 98.29 yen on Thursday, the dollar was now back at 97.20.
"The market initially bet that tapering of the Fed will not cause chaos in markets, boosting the dollar against the yen. But as share prices kept falling for two days, that is coming into doubt. If market sentiment tilts more towards risk-off, the yen could strengthen further," Tokai Tokyo's Saito said.
Thus all the focus was on emerging (EM) and commodity-linked currencies where investors are bailing out of once popular positions and repatriating the funds.
"The normalisation of Fed policy, combined with weaker commodity prices and a declining growth differential between the emerging and developed world, makes for a challenging backdrop for EM in the months ahead," said analysts from Barclays.
When investors unwind emerging market positions the most liquid cross is into the U.S. dollar, a major reason it has shot up against currencies from Brazil, to Turkey, South Africa, Poland and Mexico.
But many of those investors are from Europe, the UK or Japan and they then exchange those dollars for euros or pounds or yen, limiting the dollar's advance.
That also suggests these currencies could be driven by unwinding of existing positions, rather than fresh bets based on economic fundamentals, making their trading unpredictable.
"Price adjustments in emerging markets are quite outstanding. The markets may trade on this theme for now, perhaps until early next month," said Takako Masai, forex manager at Shinsei Bank.
"My guess is the dollar/yen won't have a convincing trend for the time being. It will be stuck in 95-100 range," she added.
Asian currencies have also been spooked by disappointing data out of China and an ongoing clampdown on liquidity by the central bank there.
That in turn has added to fears of slower global growth which, when combined with a rising U.S. dollar, is poison for commodity prices and currencies leveraged to them.
Chinese repo rates slipped on Friday from record levels hit the previous day as the liquidity squeeze eased, helping to lift the Australian dollar from a 33-month low.
The Australian dollar gained 0.3 percent on Friday to $0.9232 after having sunk to $0.9163 on Thursday.
Most Asian currencies were soft against the dollar and regional equities were weak as well, but their losses on Friday were smaller compared with Thursday.