* Yen hits highest since February vs dollar
* Dollar up vs Aussie, sterling and euro
* G8 draft statement doesn't mention FX; Q2 earnings eyed (Recasts, updates prices, adds detail)
NEW YORK, July 8 (Reuters) - The yen and U.S. dollar climbed broadly on Wednesday as risk aversion rose on uncertainty about the global economy and U.S. corporate earnings.
Gains in the yen multiplied after it traded through key technical levels on the dollar, prompting investors to unwind any carry trades where they had borrowed in yen to buy higher-yielding currencies.
As they sold the high-yielding currencies, they bought back yen.
The dollar was also doing better after a Japanese official said leaders of the Group of Eight nations did not discuss the dollar's role as the key global currency at Wednesday talks on the economy.
News that Chinese President Hu Jintao, who was due to attend the summit in Italy, was returning home to deal with unrest in the western region of Xinjiang had already dampened speculation that any currency comment would be added.
Investors then focused on whether Chinese economic growth will be a driver of the global economy, given internal problems.
"Risk assets are still being liquidated," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey. "That's hitting the yen crosses and carry trades are under significant pressure. And most of the selling so far of those yen crosses has been absorbed by dollar/yen."
The euro fell to 127.63 yen, its lowest since May, according to Reuters data in New York. It last traded down 2.9 percent at 128.03 yen.
The dollar lost 2.5 percent to 92.44 yen, having hit its lowest since February, according to Reuters data in New York.
The euro was down 0.6 percent against the dollar at $1.3840.
Draft statements for the G8 leaders and for leaders of emerging market economies, however, made no direct reference to foreign exchange, though they highlighted "significant risks" facing the world economy, texts seen by Reuters showed.
China had been one of the most vocal in seeking to discuss an alternative international currency to the U.S. dollar, but political turbulence in China had turned investor attention elsewhere.
"Part of the optimism earlier about a worldwide recovery was based on the assumption that China would be this locomotive of growth and keep the rebound going," said Boris Schlossberg, director for currency research, at GFT Forex.
"As the political situation in China becomes problematic, it provides another reason for investors to sell any high-yielding currencies, benefiting the dollar and the yen," he said.
The first Dow component to report quarterly earnings, Alcoa Inc, is expected to post its third consecutive quarterly loss later on Wednesday. (Reporting by Nick Olivari; Additional reporting by Vivianne Rodrigues and Wanfeng Zhou; Editing by Kenneth Barry)