* Dollar gains, Aussie tumbles as China hikes rates
* Market awaits a host of Fed speakers for clues on QE
* U.S. Treasury's Geithner comments support dollar
(Updates prices, adds reaction to China rate hike)
By Jessica Mortimer
LONDON, Oct 19 (Reuters) - The dollar gained while the Australian dollar and other commodity-linked currencies fell sharply on Tuesday after China's central bank raised interest rates, sparking a sell-off in perceived riskier currencies.
The People's Bank of China surprised markets by raising its benchmark one-year lending and deposit rate by 25 basis points effective from Oct. 20, the first rate increase in nearly three years. [ID:nSGE69I0HU]
The euro extended losses against the dollar on the news, but the Australian dollar was one of the main losers, with investors concerned the move could dampen growth in China, hitting commodity-linked economies in particular.
"The gut reaction of the market is to sell commodity block and emerging market currencies," said Kit Juckes, currency strategist at Societe Generale.
But he added the move was "not a game changer", and that investors would be looking to pick up these currencies on dips.
The dollar extended earlier gains which came after U.S. Treasury Secretary Tim Geithner said the United States would not engage in dollar devaluation and needed to work hard to preserve confidence in a strong dollar. [ID:nN18287076]
At 1155 GMT, the euro
The euro turned lower again, having earlier cut losses after Germany's ZEW institute said its economic sentiment index was at -7.2 in October, down from -4.3 in September but better than forecasts of -8.0. [ID:nLDE69I0WE].
The Australian dollar tumbled more than 1 percent on the day
to hit a session low of $0.9776
DOLLAR FIRMER
Against a basket of currencies the dollar <.DXY> rose to a session high of 77.720, its strongest in five days. Technical analysts say it needs to extend above its Oct. 12 high of 77.93 to signal a short-term bottom is in place after Friday's 10-month trough of 76.144.
The U.S. currency has been backed by a view among many in the market that the monetary easing expected from the U.S. Federal Reserve next month is largely priced in.
But the market must wait to see how sizeable the QE will actually be. Until then, short-term players were simply flipping positions within tight ranges, traders said.
"Comments from Geithner and a reversal in short dollar positions is pushing it higher," said Gareth Berry, currency strategist at UBS, Singapore. "But this will not last too long with many waiting to see what the Fed will do next month."
A host of speakers from the Fed are due to speak on Tuesday. More and more policymakers are signing up for QE, so any indications how far the U.S. central bank will go to stimulate the economy could weigh on the dollar.
Fed Chairman Ben Bernanke is scheduled to give brief remarks while New York Fed President William Dudley, Chicago Fed chief Charles Evans, Atlanta Fed chief Dennis Lockhart, Minneapolis Fed President Narayana Kocherlakota and Dallas Fed President Richard Fisher are expected to speak later in the day.
Analysts said Geithner's comments on the U.S. dollar ahead of the G-20 meeting meant the United States was trying to work out an agreement with emerging economies like China which would ease the currency tensions that have marked the past few weeks.
The dollar rose 0.4 percent against the yen to 81.59 yen