(Corrects third bullet point to ... RBA ..., not ... RBS)
* Risk appetite boosted by stocks rally
* Euro, sterling, Aussie, kiwi near multimonth highs
* RBA likely to keep rates at 3 pct, may drop easing bias
By Kaori Kaneko
TOKYO, Aug 4 (Reuters) - The dollar traded close to its lowest level this year against a basket of currencies on Tuesday after bullish global stocks and upbeat economic data from around the world lifted investor risk-appetite.
The euro, sterling and commodity-linked currencies such as the Australian and New Zealand dollars held firm near multimonth highs against the dollar, after positive manufacturing reports from the U.S., Europe and China on Monday boosted hopes about the global economy, dealers said.
"Expectations for a global economic recovery were boosted further after the series of upbeat data," said Tomohiro Nishida, treasury department manager at Chuo Mitsui Trust and Banking.
"The market will likely keep its risk-taking stance but we may see some correction in the market as we get closer to Friday's U.S. employment report," he said.
The U.S. manufacturing sector continued to shrink in July but at a slower pace than in June. The Institute for Supply Management said its index of national factory activity rose to 48.9 in July from 44.8 in June, beating economists' expectations. A reading below 50 indicates contraction.
The euro zone's factory sector edged closer to recovery in July and a key gauge of China's manufacturing sector hit a one-year high, data showed on Monday.
The dollar index, a gauge of the greenback's performance against six other major currencies, stood around 77.649, little changed from late U.S. trade on Monday when the index fell as far as 77.451, its lowest since Sept. 29.
The euro edged down 0.1 percent to $1.4397, but was not far from this year's high of $1.4445 hit on trading platform EBS on Monday.
Against the yen, the euro was down 0.1 percent at 137.12 yen after touching 137.55 on EBS the previous day, its highest since mid-June.
The dollar was down 0.1 percent at 95.17 yen.
Sterling held firm at $1.6930 after jumping as high as $1.6988, its highest in nine months, on Monday.
The Reserve Bank of Australia will announce its interest rate decision later on Tuesday. The central bank is seen as almost certain to keep interest rates steady at 3.0 percent for a fourth month and might take a step towards eventual hikes by dropping any reference to room for easing.
Australian Treasurer Wayne Swan said on Tuesday that Australian interest rates would rise along with other global interest rates.
The Australian dollar rose 0.1 percent to $0.8430 after brushing a 10-month high of $0.8441 on the Reuters dealing system on Monday. (Editing by Chris Gallagher)