* China should increase holdings of EUR, JPY - Chinese report
* Yen gets boost from the report, off 1-mth low vs dlr
* Pound sell-off intensifies on economic gloom
By Satomi Noguchi
TOKYO, Oct 26 (Reuters) - The dollar fell to a 14-month low against the euro on Monday as a Chinese report saying Beijing should increase its holdings of euros and yen in its foreign reserves led investors to sell the greenback.
The yen also got a boost from the opinion piece in the Financial News, a paper published by the People's Bank of China, which said that the dollar should remain the principal currency in China's foreign exchange reserves but that the share of euros and yen should increase.
The euro's rise against the dollar was also helped by European Central Bank Governing Council member Christian Noyer making no comment on euro/dollar, which speculators took as an excuse to push the single currency higher.
"The news is moving the market this morning to bring euro/dlr higher, with the pair looking very biddish at its lows," said a trader for a Japanese trust bank.
The euro rose as high as $1.5064 on trading platform EBS, its highest since August 2008, pushing up from below $1.50 in early trade.
The dollar index, a gauge of the greenback's performance against six other major currencies, fell 0.2 percent to 75.292 towards a 14-month low of 74.940 touched last week.
The dollar fell 0.4 percent to 91.70 yen, retreating from a one-month high of 92.23 yen on EBS hit earlier in the day.
The Australian dollar erased its earlier losses and rose 0.4 percent to $0.9254, rebounding towards a 14-month high of $0.9330 reached last week.
The Aussie traded softly earlier in the day as data showed Australia's third-quarter producer price index (PPI) numbers rose only modestly, taking pressure off the central bank for an aggressive rate rise.
The pound extended losses after data on Friday showed the UK economy was still struggling, disappointing investors who had been paring short positions betting on an early return to growth.
Sterling's drop was compounded by speculation that U.S. interest rates could be headed higher sooner than expected.
The pound broke past support at $1.6300 to fall to $1.6251 from $1.6313 late on Friday when it lost nearly 1.9 percent.
Traders say investors are set to aggressively sell the pound on expectations that a sluggish road to recovery would prompt the Bank of England to keep rates near zero for a long period of time. (Editing by Hugh Lawson)