* Yen hits 5-mth low vs euro, 2-½ mth lows vs Aussie, kiwi
* ECB's Trichet: cenbank reluctant for rates to fall to 0%
* U.S. to put in $75 bln-$100 bln into toxic asset programme
By Charlotte Cooper
TOKYO, March 23 (Reuters) - The yen fell to its lowest in five months against the euro on Monday and dropped more than 1 percent against higher-yielding currencies as investors grew bolder on U.S. plans to tackle financial system problems.
Stock markets around Asia rose in anticipation of plans by Treasury Secretary Timothy Geithner to purge U.S. banks of "toxic" assets, leaving the yen, which had been a gainer last year in times of financial stress, at the mercy of the Australian and New Zealand dollars.
Geithner is set to speak at 1245 GMT but a U.S. official gave details of the plan beforehand, saying the government would put in $75 billion to $100 billion from its bailout fund to partner with private investors and buy troubled assets at the heart of the financial crisis.
"It's naturally positive news for the financial markets. The scheme is necessary for the market, and the size of the reported toxic assets to be bought seems large," said Jun Kato, deputy general manager of the treasury business group at Shinkin Central Bank.
Traders and analysts said that as well as improved risk appetite investors were favouring currencies whose could rise towards 134 yen later this week.
ECB WARY OF ZERO RATES
European Central Bank chief Jean-Claude Trichet signalled that the central bank remained wary of interest rates falling to zero in a newspaper interview published on Monday, in contrast with the U.S. and Japan, where rates are already almost zero.
Trichet said the ECB could cut rates further, from a record low of 1.5 percent, but there were drawbacks with policy rates at zero and the central bank did not think it would be appropriate.
The ECB has become increasingly isolated among major central banks as it has not moved beyond interest rate cuts to other forms of quantitative easing to boost the recession-hit region.
The Bank of England has already begun buying government bonds to pump money into the system and the Bank of Japan last week raised the amount of government bonds it plans to buy.
The Fed's decision last week saw the dollar notch up its steepest weekly fall since 1985 against a basket of currencies.
The dollar firmed 0.3 percent to 96.25 yen, but was still well down from a four-month high of 99.69 hit earlier in March. It dropped to a one-month low of 93.55 last week.
The euro gained 0.6 percent to $1.3655, after hitting a 2-½ month high at $1.3739 on EBS last week.
"The basic direction for the dollar is the downside still," said Masafumi Yamamoto, head of FX strategy Japan at Royal Bank of Scotland. "We have seen some rebound on Friday so it's not a one-way street. But the dollar remains heavy." (Additional reporting by Satomi Noguchi and Masayuki Kitano; Editing by Chris Gallagher)