* Commody-linked currencies at one-yr highs on gold glitter
* Euro at strongest on dlr in a month; firmer shares help
* Focus on U.S. markets reopening for further cues
(Recasts with Aussie at new 1 yr peak, changes byline,
dateline previously TOKYO)
By Emelia Sithole-Matarise
LONDON, Sept 8 (Reuters) - The dollar slumped to its lowest
in almost a year against a basket of major currencies on Tuesday
as gold rallied above $1,000 an ounce with traders citing talk
of reserve diversification into gold undermining the U.S.
currency.
Renewed concern over the dollar's long-term status as the
world's reserve currency sparked by a United Nations agency
report on Monday [] and options-related euro buying
also fuelled the broad-based dollar selling.
"A combination of a pick-up in industrial activity being
cemented and talk of reserve diversification into gold is
keeping dollar on the back foot," said Chris Turner, head of FX
strategy at ING.
"There is more evidence of industrial activity picking, from
German data on Monday and UK data today. That means re-stocking
in Q3 which is good for commodities and commodity currencies."
The dollar index, a gauge of the greenback's performance
against six major currencies, fell almost one percent on the day
to 77.398 <.DXY>.
Against the yen, the dollar dipped 0.8 percent from late
Monday trade to 92.23 yen <JPY=>.
The euro rose as high as $1.4438 <EUR=>, according to
Reuters charts, up two thirds of a percent on the day, and the
dollar's trade-weighted index fell 0.75 percent to 77.445
<.DXY>.
Gold jumped more than 1 percent to $1,007.45 an ounce
<XAU=>, its highest since March last year.
KEY LEVELS BREACHED
This helped hoist the Australian and New Zealand dollars to
their strongest levels in a year against the U.S. dollar.
The Aussie <AUD=D4> rose as high as $0.8634, its highest
since August 2008. Data also showed Australia's business
confidence hit a six-year high in August, adding to mounting
speculation that local rates will rise in coming months,
providing overall support to the Aussie.
"Risk appetite remains the key driver for these currency
markets," said Daragh Maher, deputy head of global currency
research at Calyon in London.
"We saw the Chinese equity market which was lower in the
early part of the session rebound quite sharply in second half
of the session that has given the broad equity theme a lift.
That's helped drive the risk currencies a bit higher."
European shares <> were up 0.5 percent by 0850 GMT.
Investors had been encouraged by global financial chiefs'
statements at the weekend that it was too soon to start
unwinding fiscal, monetary and financial-sector stimulus
measures.
The Australian dollar <AUD=D4> rose as high as $0.8634, its
highest in just over a year. Data also showed Australia's
business confidence hit a six-year high in August, adding to
mounting speculation that local rates will rise in coming
months, providing overall support to the Aussie.
With currencies and gold hitting those key levels, currency
market participants were now waiting for U.S. markets to reopen
after Monday's holiday for clues on whether the rally in riskier
currencies will be sustained.
The kiwi <NZD=D4> rose to a new one-year high of $0.6944
<NZD=D4>, extending the previous session's gains. The gains come
ahead of a Reserve Bank of New Zealand meeting on Thursday to
decide on monetary policy.
The recent surge in the kiwi could be a focus of Governor
Alan Bollard, who has expressed his discomfort with its rise.
The currency has rallied 30 percent since March, forcing
monetary conditions to tighten to the frustration of the RBNZ
which threatened to cut interest rates at its last meeting in
July.
