MOSCOW - Russia will reduce the share of U.S. treasuries in its forex reserves, the world's third-largest, a senior central bank official said on Wednesday, driving the dollar broadly lower.

Russia holds about 30 percent of the reserves, worth $404.2 billion, in treasuries. Central bank First Deputy Chairman Alexei Ulyukayev said it would buy bonds issued by the International Monetary Fund and also up the share of reserves held in bank deposits.

Russia had earlier pledged to buy about $10 billion worth of bonds to be issued by the IMF as part of a fundraising effort to help countries hit by the global financial crisis.

Ulyukayev said Russia had increased its investment in liquid treasuries during the peak months of the crisis and was now ready to cut it, also increasing investment in commercial banks' deposits.

Now this share (of treasuries) will fall because the window of opportunity is opening, the situation with banks is becoming clearer. We will increase the share of bank deposits, the share of repos will be bigger as well, Ulyukayev said.

The dollar slipped against a range of currencies, while U.S. Treasury yields rose after news of the Russian statement.

The dollar index fell as low as around 79.483 after the news from 79.662 shortly before the comments.

U.S. Treasuries fell further after the comments, pushing up the benchmark 10-year T-note yield more than five basis points to a session high of 3.92 percent.

This is potentially quite negative for the dollar, said Geoff Kendrick, senior currency strategist at UBS in London. The main jump was in sterling ... If anyone just now would benefit it would probably be investments into sterling as a reserve currency.

(Reporting by Yelena Fabrichnaya, writing by Gleb Bryanski; editing by Patrick Graham)

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