* Dollar hovers below 1-month high, Fed awaited
* Retail sales take Aussie lower on near-term rate doubts
* Aussie slippage feeds into cross/yen
By Charlotte Cooper
TOKYO, Nov 4 (Reuters) - The dollar steadied below a one-month high on a basket of currencies as investors awaited a Fed statement later on Wednesday, while the Australian dollar eased after data dimmed hopes for a December rate hike, taking others down with it.
The main focus of the day is the Federal Reserve's statement at the end of its two-day meeting, with speculation it might drop or alter its pledge to keep rates low for an "extended period"..
The dollar index, a measure of the greenback against a basket of six currencies, hit 76.817 on Tuesday, its highest since early October, but traders said its failure to break above a 55-day moving average at that level meant it was still in a bear trend that stretches back to March.
Only a deterioration in the global economic outlook or a clear warning from the Fed that rate increases were coming would change that, but several traders and analysts said they doubted the Fed statement would show it materially altering its stance.
"While the Fed may tweak the statement, they will be very cautious about withdrawing any liquidity," said a senior trader at a European bank.
"But certainly it's going to be an ongoing discussion and I think they're going to keep that discussion going because they don't want to appear too dovish, they don't want to fuel the asset bubbles. So they'll talk hawkish but do nothing."
The euro held steady at $1.4720, having lost nearly 0.4 percent on Tuesday.
Investors have been taking profits in long positions against the dollar in recent days, fuelling losses in the likes of the Aussie dollar and the euro and making investors and traders nervous the appetite for risk-on trades is fading.
One trader in Tokyo said gold, which hit a record high on Tuesday, appeared to be benefiting from buying by short-term speculators, who were hesitant about buying the euro and Aussie while they faced profit-taking from year-end book closing by funds and other investors.
Recent currency swings have boosted implied volatility, a measure of currency fluctuation and a barometer of risk sentiment. The higher the vol, the greater the fear in the market.
One-month euro/dollar vols advanced to as high as 12.50 on Tuesday from about 11.00 and was around 12 on Wednesday. The one-month contract on Aussie/dollar implied vol traded at 17.5, up from about 15.95 late last week.
The Aussie dipped to about $0.8985 after an unexpected fall in September retail sales added to doubts about a near-term rate hike, slipping within range of a long-term uptrend around $0.8900.
"The disappointment pushed the Aussie down and the yen crosses down, as well as dollar/yen," said Masafumi Yamamoto, chief FX strategist Japan at Barclays Capital.
The Aussie later edged back up to $0.9018, about the same as late New York trading levels.
The dollar eased 0.1 percent to 90.27 yen and the euro also softened to 132.94 yen.
The market faces other major risk events as well this week including U.S. non-farm payrolls data due on Friday and European Central Bank and the Bank of England policy meetings on Thursday. and.
News about the European Commission's estimates of bank losses also renewed anxiety over the sector's health. The EU Commission quoted results of stress tests in the banking sector, published in early October, which said losses could amount to 400 billion euros ($585.2 billion) in 2009-10. (Additional reporting by Satomi Noguchi in Tokyo and Anirban Nag in Sydney; Editing by Joseph Radford)