* Euro breaks above $1.50 for first time in 14 months
* Sterling jumps on BoE minutes; Kiwi up on RBNZ comments
* Markets see Fed lagging other banks in tightening
(Recasts, adds details, updates prices)
By Nick Olivari
NEW YORK, Oct 21 (Reuters) - The dollar touched a one-month low against sterling on Wednesday and the euro broke above the $1.50 level for the first time in 14 months as expectations for low U.S. interest rates weighed on the greenback.
Sterling rose soon after minutes from a Bank of England meeting suggested officials are not ready to expand an emergency asset buying program and had "differences of view" on inflation.
Analysts said that suggests central banks outside the United States are considering winding down programs that have flooded their economies with money. If the U.S. Federal Reserve doesn't follow suit and holds interest rates at record lows, that would diminish investor desire to hold dollars.
Sterling was last up 1.2 percent to $1.6578
"Not everyone is serious about raising rates yet, but the fact that the BoE may not add any more money to the system has the market looking for the same type of rhetoric from the Fed," said Boris Schlossberg, head of FX research at GFT Forex in New York.
"Part of the reason the dollar is hobbling along, trying to keep its footing, is that people think the Fed is handcuffed until the labor market stops contracting," he said.
Sterling also gained 0.9 percent against the Australian and
Canadian dollars
Late Tuesday, San Francisco Federal Reserve President Janet Yellen said the time for monetary policy tightening in the U.S. was still some way off. For details see [ID:nN20459802].
The Fed has extended more than $2 trillion of credit to the financial system, and Chairman Ben Bernanke has said interest rates should remain low for some time. That makes the dollar less attractive to investors than higher-yielding currencies and assets more closely correlated with economic recovery.
Against a basket of currencies, the dollar <.DXY> hit a fresh 14-month low of 74.94. Whether the euro, the biggest component of the basket, pushes higher depends to some extent on U.S. stocks and crude oil futures, which broke to $82 a barrel on Wednesday.
The dollar and commodities are often inversely correlated, with gold and oil priced in dollars and seen as an alternative currency and hard asset themselves.
"Before we say the floodgates have opened, we have to see whether gains in the S&P 500 and oil are going to accelerate as quickly," said Andrew Chaveriat, technical analyst at BNP Paribas in New York. A euro move to around $1.5070 could spark profit-taking and a temporary retreat, he added.
The dollar, however, was up 0.2 percent against the yen to
90.88 yen
BOE TAKES FOOT OFF THE GAS
BoE officials voted unanimously to continue a 175 billion pound quantitative easing program, minutes showed, surprising those who feared the bank might expand its size and scope.
Policymakers differed on the inflation outlook, however, suggesting some were wary of adding more money to the system. [ID:nLL60939].
"The minutes shifted the balance of risks in favor of a pause in asset purchases in November, which the pound has reacted to," said Lee Hardman, strategist at Bank of Tokyo-Mitsubishi UFJ in London.
The New Zealand dollar rose 1 percent to $0.7573
This month, Australia became the first developed country to
raise rates since the global crisis began, pushing the
Australian dollar
In China, the State Council said economic recovery had been "consolidated," a shift in rhetoric some analysts say may be the first hint officials are at least thinking about how to normalize loose monetary and fiscal polices. [ID:nPEK213103]
In other currency pairs, the dollar fell as low as 1.0036
Swiss francs