(Adds dateline, comment, fresh prices)
    By Herbert Lash and Amanda Cooper
       NEW YORK/LONDON, March 17 (Reuters) - The dollar fell on
Friday as concerns of further turmoil in banking rattled equity
markets and sent Treasury yields lower, while driving fears that
a recession lies on the horizon.
        An early recovery in European stocks ran out of steam as
investor sentiment remained fragile after a week of turbulence
sparked by the failure of Silicon Valley Bank and concerns over
Credit Suisse  CSGN.S  despite a $54 billion lifeline for the
bank.
  
        The University of Michigan's survey of consumer
sentiment fell for the first time in four months even as
readings on inflation expectations receded. The survey was
mostly done before regulators shut SVB last week. 
  
        Preliminary results on economic conditions and consumer
expectations also slid, the UMich surveys showed.
  
        The dollar index  =USD , a measure of the dollar against
six other currencies, 
    fell 0.249%
    , while the euro  EUR=  was 
    up 0.26% to
     $
    1.0633
    .
  
        Contracts in the fed funds futures show a 74.5%
probability of the Federal Reserve will raise interest rates by
a one-quarter percentage point next week, CME's FedWatch Tool
shows.
  
        But expectations also show the Fed will be cutting rates
by July as recession fears mount. 
  
        "There's this belief that we're heading towards a
recession and depending on if the Fed makes a policy mistake, it
can be a really severe one," said Ed Moya, senior market analyst
at OANDA in New York.     
  
        "There is a wait and see approach as to what will happen
with the U.S. economy," he said. "Now we're not debating a‘soft
landing, no landing.’ We're debating is it a mild or severe
recession."
  
    The rescue of First Republic on Thursday initially boosted
risk appetite on Friday as concerns about global banks eased,
making way for surges in the Australian and New Zealand dollars.
    Banking troubles revived memories of the 2008 financial
crisis, in which dozens of institutions failed or were bailed
out with billions of dollars of government and central bank
money.
    Three smaller U.S. lenders, including First Republic, have
had regulators and other banks step in to prop them up, while in
Europe, Credit Suisse became the first major global bank since
the financial crisis to get an emergency lifeline.    
    Sterling  GBP=  was last trading at $1.2144, up 0.31% on the
day, while the dollar  CHF=  fell 0.17% against the Swiss franc.
Earlier in the week, the franc plunged by the most against the
dollar in a day since 2015, when the Swiss central bank loosened
its currency peg.
    The Japanese yen  JPY= , which tends to benefit in times of
extreme market volatility or stress, strengthened 1.28% versus
the greenback at 132.05 per dollar. 
    Japan's Ministry of Finance, Financial Services Agency and
Bank of Japan officials met on Friday evening to discuss
financial markets. 
    Masato Kanda, vice finance minister for international
affairs, told reporters after the trilateral meeting that the
government, the central bank and the banking watchdog would
coordinate to ensure the stability of the financial system.
    The Australian dollar  AUD= , which often outperforms when
investors are feeling optimistic, rose 0.44% at $0.668.

    Currency bid prices at 11:07 a.m. (1507 GMT)
 Description        RIC          Last        U.S. Close   Pct Change       YTD Pct         High Bid     Low Bid
                                              Previous                      Change                      
                                              Session                                                   
 Dollar index        =USD        104.1100    104.3900     -0.25%           0.599%          +104.4400    +103.8900
 Euro/Dollar         EUR=EBS     $1.0634     $1.0611      +0.21%           -0.77%          +$1.0670     +$1.0611
 Dollar/Yen          JPY=EBS     132.0350    133.7800     -1.30%           +0.71%          +133.7350    +131.8200
 Euro/Yen            EURJPY=     140.40      141.91       -1.06%           +0.09%          +142.2000    +140.1700
 Dollar/Swiss        CHF=EBS     0.9276      0.9293       -0.15%           +0.35%          +0.9299      +0.9241
 Sterling/Dollar     GBP=D3      $1.2144     $1.2110      +0.30%           +0.43%          +$1.2175     +$1.2103
 Dollar/Canadian     CAD=D3      1.3757      1.3722       +0.30%           +1.57%          +1.3762      +1.3679
 Aussie/Dollar       AUD=D3      $0.6684     $0.6658      +0.41%           -1.93%          +$0.6724     +$0.6650
 Euro/Swiss          EURCHF=     0.9863      0.9859       +0.04%           -0.30%          +0.9881      +0.9841
 Euro/Sterling       EURGBP=     0.8754      0.8760       -0.07%           -1.02%          +0.8782      +0.8745
 NZ Dollar/Dollar    NZD=D3      $0.6252     $0.6196      +0.90%           -1.54%          +$0.6260     +$0.6192
 Dollar/Norway       NOK=D3      10.7320     10.7700      -0.23%           +9.49%          +10.7660     +10.6700
 Euro/Norway         EURNOK=     11.4156     11.4211      -0.05%           +8.78%          +11.4364     +11.3507
 Dollar/Sweden       SEK=        10.5172     10.5049      +0.18%           +1.04%          +10.5515     +10.4430
 Euro/Sweden         EURSEK=     11.1784     11.1582      +0.18%           +0.26%          +11.2054     +11.1239
 
    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
World FX rates    https://tmsnrt.rs/2RBWI5E
SVB Financial seeks bankruptcy protection as banking turmoil
persists     urn:newsml:reuters.com:*:nL4N35P2N7
ECB watchdog sees no Europe contagion after US, Swiss bank
rescues     urn:newsml:reuters.com:*:nL4N35O50F
First Republic shares fall despite unprecedented Wall Street
rescue deal     urn:newsml:reuters.com:*:nL4N35O47V
GRAPHIC-Banking worries send US markets on dizzying ride   
 urn:newsml:reuters.com:*:nL1N35O2WZ
Major US banks inject $30 bln to rescue First Republic Bank   
 urn:newsml:reuters.com:*:nL1N35O01H
ANALYSIS-Is the backlash over SVB collapse a threat to 'woke'
investments?     urn:newsml:reuters.com:*:nL8N35M4XO
ANALYSIS-SVB's climate tech clients face humbling funding
questions     urn:newsml:reuters.com:*:nL8N35O3DN
ANALYSIS-Investors stick to bets on early end to ECB hikes as
uncertainty grows     urn:newsml:reuters.com:*:nL1N35P0MD
GRAPHIC-Markets tumble then recover amid bank crisis    https://tmsnrt.rs/3mNboDp
GRAPHIC-Americans opt to keep their money with the banks    https://tmsnrt.rs/3LrAFxq
GRAPHIC-Majority of Americans oppose a bank bailout    https://tmsnrt.rs/408dP1Y
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Additional reporting by Rae Wee in Singapore; Editing by
Kirsten Donovan, Susan Fenton and Nick Zieminski)
 ((amanda.cooper@thomsonreuters.com; +442031978531; Twitter: https://twitter.com/a_coops1;))