* Sterling hits 7-½ yr low vs dlr, euro hits 6-week low
* Yen underpinned by safety buying as stocks fall
By Kaori Kaneko
TOKYO, Jan 21 (Reuters) - Sterling hit a 7-½ year low against the dollar and the euro touched a 6-week trough on Wednesday on rekindled concerns over losses in the U.K. banking sector and a deepening recession in the euro zone.
The yen was firm against other major currencies, underpinned by safe-haven buying as a tumble in U.S. shares and growing concerns over the global banking sector raised investors' risk aversion.
Wall Street ushered in the Barack Obama presidency with a record Inauguration Day drop on Tuesday amid fresh signs the global bank crisis was far from over.
Tokyo's Nikkei share average slipped more than 2 percent after the Dow Jones industrial average on Tuesday dropped below 8,000 for the first time since late November 2008.
The MSCI index of Asia-Pacific stocks outside Japan shed 1.1 percent.
"It seems expectations for the new administration have run their course as the U.S. economic outlook will be severe for a while. And the weakness in U.S. shares was more than expected," said Kazuyuki Kato, treasury department manager at Mizuho Trust & Banking.
Obama pledged bold and swift action to bring new life to the U.S. economy but did not provide details on economic crisis measures in his address at his inauguration.
Sterling fell as low as $1.3815, its lowest since mid-2001, in early trade and recovered to $1.3873, up 0.2 percent from late U.S. trade.
Against the yen, sterling sank to a record low of 123.95 yen before recovering to be down 0.1 percent from late U.S. trade at 124.74 yen.
The euro fell 0.1 percent to $1.2892 after hitting a six-week low of $1.2845 on trading platform EBS.
The euro was steady at 115.88 yen, and the dollar edged up 0.1 percent to 89.90 yen.
Investors were looking ahead to major U.S. corporate earnings and housing-related data this week. (Reporting by Kaori Kaneko; Editing by Hugh Lawson)