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The euro edged up against the dollar Monday after the US and Europe slapped sanctions on an inner circle of Russians and Ukrainians who supported Crimea's vote to join Russia.
The overwhelming pro-Russia vote Sunday was expected, and the United States and the European Union acted swiftly Monday to impose economic sanctions on key leaders of the breakaway move they denounced as a violation of international law.
The euro rose to $1.3921 around 2100 GMT, up from $1.3909 late Friday.
The European currency also gained ground against the Japanese unit, buying 141.58 yen compared with 140.94 yen Friday.
The dollar climbed to 101.68 yen from 101.33 yen.
"The world is watching to see how Russia will respond to the new sanctions," said Kathy Lien of BK Asset Management.
Lien said the euro was trading higher because the sanctions did not apply to Russian President Vladimir Putin, members of his family or key economic or banking officials.
"It is wishful thinking to believe that he will buckle under the pressure of these weak measures," she added.
Lien warned the crisis could escalate, with Russia already threatening to retaliate against the sanctions.
"The bottom line is that it is very difficult to be optimistic under these circumstances because of the material risk that the crisis in the Ukraine will deepen and for this reason we eye the rally today in the EUR/USD and other major currency pairs with extreme caution," she said.
The dollar rose against the Swiss currency, to 0.8729 franc from 0.8722 late Friday.
The British pound slipped to $1.6635 from $1.6645.