By Alun John

HONG KONG (Reuters) - The Australian dollar stood tall while the yen slumped further as higher energy prices continued to drive moves in foreign exchange markets on Wednesday.

Against the Japanese currency, the Australian dollar edged up to hit its highest level since December 2015 and has gained 8% in March so far. Versus the dollar, it touched a four-and-a-half month high of $0.7477 in early trade, having gained 0.95% overnight, before slipping back a whisker to $0.7455.

"The Aussie dollar has benefited from a few things: Australia is far away from the conflict in Ukraine, higher commodity prices in terms of LNG and coal, a domestic economy which is doing well and the possibility of an improvement in China, which also tends to benefit the Aussie dollar," said Sim Moh Siong, senior currency strategist at Bank of Singapore.

Chinese stocks have rallied in recent days following remarks from Chinese vice premier Liu He last week that Beijing would roll out support for the Chinese economy.

High commodity prices are bad news for the yen, however, as Japan imports the bulk of its energy, widening the country's trade deficit.

The yen slipped to a new six-year low of 121.415 per dollar which had climbed 1.1% on the Japanese currency overnight.

"USD-JPY has nowhere to go but up," said analysts at TD Securities, who pointed to the differential between U.S. and Japanese rates and the yen's vulnerability to the shocks roiling commodities markets in the wake of Russia's invasion of Ukraine.

Commodity prices have surged following Russia's invasion of Ukraine and the ensuing Western sanctions. On Wednesday, Brent crude futures rose a further 1.5% to $117 per barrel [O/R]

The yield on U.S. benchmark 10-year yields rose to 2.417% in Asian hours on Wednesday, still supported by U.S. Federal Reserve Chair Jerome Powell's speech on Monday which opened the door for raising interest rates by more than 25 basis points at upcoming policy meetings in order to combat inflation.

However, rising U.S. yields had little effect on the dollar against other currencies on Wednesday, as analysts said much was already priced in.

The dollar index - which measures the greenback against six major peers - was mostly unchanged at 98.413.

The euro was little changed at $1.10355, while sterling touched $1.3299, its highest against the dollar in nearly three weeks, as the market's focus turns to UK inflation data and British finance minister Rishi Sunak's Spring Statement, both scheduled later on Wednesday. [GBP/]

In cryptocurrency markets, bitcoin was around $42,069, easing back after a 3.3% overnight jump, and ether edged down to around $2,950.