* Dollar extends broad losses, hits 14-month low vs basket
* Weakness on mix of Bernanke, Trichet, RBA, Fujii, stocks
* Euro nears $1.50 but options-related selling caps gains
(Updates prices, adds comment and quotes, changes byline and dateline. Previous: TOKYO)
By Jamie McGeever
LONDON, Oct 20 (Reuters) - The dollar hit a 14-month low against a basket of currencies on Tuesday on a cocktail of policymaker comments, but options-related buying kept it from pushing through $1.50 against the euro and 90 yen.
Strength in global stocks, fired by Apple Inc's forecast-beating third-quarter earnings overnight, also fed traders' appetite to sell dollars for higher-yielding currencies and assets more closely correlated with economic recovery.
The euro touched a 14-month high of $1.4994 as markets took comments on its strength from European Central Bank President Jean-Claude Trichet as a repeat of previous remarks, suggesting no real increase in policyamakers' level of concern.
Federal Reserve Chairman Ben Bernanke called on Monday for action on global imbalances, saying China and other Asian countries were looking more seriously at rebalancing but some issues could be addressed through greater FX flexibility. Some analysts saw this as veiled endorsement for a lower dollar.
The Australian dollar pierced $0.9300 after hawkish comments from the central bank and the dollar fell back towards 90 yen after Japan's finance minister said recent yen strength was more a function of the dollar's weakness.
"Bernanke's comments are being taken by the market that rates are on hold for longer. That's risk-positive and dollar-negative," said Geoff Kendrick, strategist at UBS in London, adding that the euro at $1.50 was only a matter of time.
"And there was no great surprise from Trichet. The comments haven't been strong enough. While rhetoric might increase around that ($1.50) level, I don't see any chance of unilateral action at $1.50," he said.
At 0745 GMT the dollar index, a measure of its strength against six major currencies, was down 0.4 percent at 75.18 after dipping as low as 75.103, its lowest in 14 months.
After failing to take out options barriers at $1.50, the euro was last at $1.4978, up 0.1 percent on the day.
The dollar fell 0.5 percent against the yen to 90.15 yen, a move lower also aided by the narrowing of the U.S.-Japanese 10-year bond yield spread to 205 basis points Tuesday from around 215 basis points late last week.
The Australian dollar climbed as far as $0.9310 after minutes from the Oct. 6 Reserve Bank of Australia policy meeting said it may be imprudent to keep rates very low. It was last down slightly on the day at $0.9270.
ECB ON REPEAT
Some traders had trimmed long euro positions on Monday ahead of a meeting of euro zone finance ministers and ECB President Trichet, in case they came out against the euro's recent appreciation.
In the event Trichet discussed FX rates with the ministers but then repeated the line that he had no reason for doubt when U.S. officials said a strong dollar was in U.S. interests.
"European politicians will no doubt continue to air their concerns about currency 'misalignments', although it must be said that beyond the familiar platitudes relating to the U.S. Treasury's strong dollar policy it is unclear what the Eurogroup is prepared to do, if anything, to raise the ante," said Bank of New York Mellon in a note on Tuesday.
The dollar has been under sustained pressure this year due to expectations for low U.S. interest rates and questions about its status as the world's reserve currency.
Meanwhile, comments by Japanese finance minister Hirohisa Fujii that dollar weakness was due to U.S. monetary easing were used as an excuse to sell the dollar down to 90 yen, where there are thought to be options expiries later today.
"Whenever a Japanese official suggests dollar/yen is lower due to dollar weakness in my experience it tells me there is no chance of intervention," said Neil Jones, head of hedge fund sales at Mizuho in London.