* Dollar resumes falls after brief recovery
* Equity gains support riskier currencies, weigh on dollar
* Kiwi up on RBNZ Bollard's comments; sterling up before BoE mins
(updates pricew, adds quotes, changes byline, dateline; pvs TOKYO)
By Jessica Mortimer
LONDON, Oct 21 (Reuters) - The dollar edged lower against the euro and higher-yielding currencies on Wednesday as a brief recovery from a 14-month low versus a currency basket fizzled out, helped by equity market gains which encouraged risk-taking.
The greenback had earlier stabilised as investors booked profits on recent sharp gains in higher-yielding and perceived higher risk currencies. Failure by the euro to test the key $1.50 level also buoyed the U.S. currency.
The dollar's recovery was unconvincing, however, with sentiment towards it still downbeat on the prospect of U.S. interest rates staying at exceptionally low levels for longer than most other major countries.
The New Zealand dollar shone after New Zealand's central bank chief Alan Bollard said a strong currency was not necessarily an obstacle to raising the cash rate..
"The dollar's carry disadvantage is working to prevent any significant dollar recovery," said Ulrich Leuchtmann, head of foreign exchange research at Commerzbank in Frankfurt.
"Euro/dollar failed to break through $1.50 yesterday, but the downside in the pair is limited and we cannot rule out another attempt at that level".
He added, however, that there were concerns the dollar's falls were starting to look a little overstretched, given that it has dropped to multi-month lows against a range of currencies recently.
At 0741 GMT, the euro was up 0.1 percent against the dollar compared with late New York trade at $1.4957, having hit a 14-month high of $1.4994 the day before.
The dollar index fell 0.3 percent from late New York levels TO 75.338, though it stayed above a 14-month low of 75.103 hit on Tuesday.
Among higher-yielding currencies, the Australian dollar rose 0.4 percent to $0.9273, while the New Zealand dollar jumped nearly 1 percent to $0.7561 in the wake of the the Reserve Bank chief Bollard's comments.
Investor appetite for buying perceived riskier currencies was lifted as European share rose 0.3 percent, close to one-year highs, as investors more corporate results from companies such as Morgan Stanley and Boeing.
This helped lift sterling to a one-month high above $1.65 against the dollar ahead of the release of the Bank of England minutes of its latest policy meeting at 0830 GMT.
Investors will be looking for clues on whether or not the bank will extend quantitative easing. Hints of an extension could pressure sterling.
Jitters remained, however, that policymakers outside the United States may increasingly express disquiet about the strength of their currencies against the sliding U.S. dollar.
On Tuesday, the Bank of Canada killed talk of an early rate hike, warning that favourable economic developments were being undermined by the Canadian dollar's strength and sending the currency down sharply.
France expressed concern about euro strength on Tuesday.
"Despite calls at the G20 level for greater FX flexibility, one risk is for countries to become impatient over the strength of their own currencies," ING currency strategists said in a note.
San Francisco Federal Reserve President Janet Yellen, however, added weight to the view that U.S. rates will stay low for some time, saying on Tuesday the time for tightening in the United States was still several months away (Reporting by Jessica Mortimer, editing by Nigel Stephenson)