* Chinese money market rates weigh * Soft U.S. jobs data cements view Fed stimulus to stay * BoC drops rate hike reference, Canadian dollar tumbles By Julie Haviv NEW YORK, Oct 23 (Reuters) - The dollar, yen and Swiss franc all rose on Wednesday after a spike in China's short-term money-market interest rates drove risk aversion, driving bids for the three safe-haven currencies. Chinese money-market rates climbed to levels not seen since July after the People's Bank of China failed to inject cash for a second day, as regulators showed signs of concern that loose liquidity might be fueling another found of risky credit expansion. The rate spike was short-lived but caused a market panic nevertheless, prompting a scramble for safe-haven dollars, Swiss francs and yen. The move came a day after the dollar plunged as soft U.S. jobs data for September appeared to rule out a cut in the Federal Reserve's monetary stimulus before next year. "The weight of a weak U.S. nonfarm (payrolls) is surpassed by rising risk aversion on concerns over China's money market. Profit-taking takes hold," said Camilla Sutton, chief currency strategist at Scotiabank in Toronto. The dollar also rose against riskier and commodity-linked currencies such as the Australian and New Zealand dollars. In afternoon New York trading, the Aussie dollar fell 0.8 percent versus the greenback to US$0.9629, while the New Zealand currency dropped 1.5 percent to US$0.8385. But the Canadian dollar plunged after the Bank of Canada on Wednesday dropped reference to any interest rate increase for the first time since April 2012, citing weak economic growth. The euro was little changed against the dollar after the president of the European Central Bank, Mario Draghi, said he wants to put in place a tougher stress test for banks. The euro was up 0.1 percent at $1.3792, matching Tuesday's high, which was its strongest since mid-November 2011. The yen was also in demand, with the dollar down 0.9 percent at 97.24 yen and the euro 0.8 percent weaker at 134.08 yen. The Swiss franc also rose, as the dollar slipped 0.4 percent to 0.8912 franc and the euro fell 0.3 percent to 1.2290 francs.. The dollar index, which gauges the dollar against a basket of widely traded currencies, was little changed at 79.256 . It fell as low as 79.137, its weakest level since early February. Still, the outlook for the U.S. dollar remained downbeat. Tuesday's U.S. jobs report has pushed out expectations for a reduction in the Fed's asset-buying plan well into 2014, Scotiabank's Sutton said. That outlook leaves the Fed's balance sheet expanding rapidly while those of other central banks are stabilizing or contracting. A majority of U.S. primary dealers polled by Reuters now believe the Federal Reserve will not start cutting its $85 billion of monthly bond purchases until March. Strategists said the Fed's next policy meeting, on Oct. 29-30, could given an indication whether policymakers have substantially changed their views on the economy. Against the Canadian dollar, the greenback surged 0.8 percent to C$1.0374. Canada's central bank meets eight times a year, and the final meeting for 2013 is set for Dec. 4. "A dovish statement from the Bank of Canada catches an inattentive market. They increased the time it takes for inflation to return to target and reduced potential growth," said Sebastien Galy, foreign exchange strategist at Societe Generale in New York. "They still haven't factored in the underlying deflationary pressures in Canada but are clearly worried, adding some emphasis on the risk of a housing correction," he said. EURO STRENGTH WORRIES The euro has gained 4.5 percent so far this year against the dollar. It recently hit a two-year peak against a trade-weighted basket. Strategists said if the euro's ascent gathered pace the ECB could adopt some form of verbal intervention or other measures to dampen its strength. A stronger euro is negative for euro zone exporters. "Euro/dollar is trading at new highs for the year and the question is, What will the response be from the ECB?" said Chris Turner, head of FX strategy at ING, in a note to clients. "Euro zone headline inflation is low, and the ECB could repeat its February stance that the strong euro increases downside risks to inflation."