* Dollar steadies after volatile moves on Geithner remarks
* Dollar edges up vs yen, off previous day's lows vs euro
* NZ dollar jumps vs dollar, yen as rates seen near bottom
* Geithner says dollar to remain world's reserve currency
(Recasts, changes dateline prvs TOKYO)
By Tamawa Desai
LONDON, March 26 (Reuters) - The dollar steadied against major currencies on Thursday after wild swings the previous day on U.S. Treasury Secretary Timothy Geithner's comments on reserve currencies.
New Zealand's dollar jumped around 2 percent against the U.S. dollar and yen as investors searching for yield took the view that interest rates there were at or very near the bottom.
"The theme of the day will likely be reflation trades, as equity markets have been up and U.S. data has outperformed recently," said Geoffrey Kendrick, currency strategist at UBS in London.
"That has boosted the Australian dollar, Kiwi and dollar/yen ... and we are seeing some short-term carry trades," he said.
Carry trades involve borrowing in one currency with low interest rates to buy higher-yielding assets in another and were a popular play against the yen before the global financial crisis.
The U.S. dollar recovered from lows hit after Geithner said he was open to expanding the use of the International Monetary Fund's Special Drawing Rights (SDRs).
His comments were initially interpreted as an endorsement of China's proposal this week to eventually replace the dollar as the world's reserve currency with SDRs. [ID:nPEK184558]
That pushed the dollar lower but it then regained ground after he said the dollar would keep its status as the top reserve currency for a long time. [ID:nN25425979]
By 0839 GMT, the dollar was flat against a basket of currencies at 83.741 .DXY.
The dollar was at 98.09 yen <JPY=>, after dipping to 96.90 yen in the previous session.
The yen has slid against high-yielding currencies in the past few weeks as gains in global stock markets have pointed to an improvement in investors' risk appetite.
Underscoring such sentiment, Asian shares were broadly higher. The rise in regional shares came after U.S. stocks rose on Wednesday as unexpectedly strong housing and durable goods data fuelled hopes the economy is finally on the mend.
The kiwi surged to its highest in more than two months at $0.5785 <NZD=D4> and touched around more than four-month peak of 56.75 yen <NZDJPY=>, according to Reuters data, as New Zealand government debt yields surged in a sign investors were reining in expectations for lower rates.
New Zealand's cash rate stands at 3 percent and the central bank has signalled it does not expect to reduce rates much further.
"The New Zealand dollar is rising on the macro view that interest rates are edging towards the bottom," said Richard Grace, chief currency strategist at Commonwealth Bank of Australia in Sydney.
The New Zealand dollar rose 1.8 percent at $0.5778 <NZD=D4> and up 2.5 percent at 56.59 yen <NZDJPY=R>.
The Australian dollar was down around 1.8 percent at 1.2081 <AUDNZD=>, hovering at a 10-week low and adding to broad strength in the kiwi. (Additional reporting by Masayuki Kitano in Tokyo; Editing by Victoria Main)