FOREX-Dollar edges higher after Fed policy move

* Dollar rises against euro, falls vs yen

* Fed delivers expected cuts of $10 billion in monthly bond purchases

(Updates with post-Fed trade, adds quote, changes byline)

By Michael Connor

NEW YORK, Jan 29 (Reuters) - The dollar rose against the euro on Wednesday after the U.S. Federal Reserve cut $10 billion from its monthly bond-buying stimulus program.

The greenback initially moved little against the yen on the widely anticipated Fed policy move that contained no surprises but widened its losses to over 1 percent in later trade, as U.S. stocks sold off.

The dollar was also up against the Swiss franc but fell shy of the session's high of 0.9009 CHF= in mid-afternoon trading after the Fed's meeting, its last with Ben Bernanke as Fed chair.

The Fed is keeping to a low-interest-rates course, an economist said, even with Janet Yellen taking the chair on Friday.

"From now and the next meeting, they will monitor the contagion risk from emerging markets to the U.S. economy," said Neil Dutta, head of U.S. economics at Renaissance Macro Research in New York. "There' some tightening of financial conditions from the EM turmoil but that's not going to keep the Fed up at night."

The U.S. central bank will trim another $10 billion from its stimulus program in March barring surprises, Dutta said.

The dollar late on Tuesday had risen against the yen and Swiss franc - traditional safe-haven currencies - after a surprisingly aggressive interest rate hike by the Turkish central bank in a bid to shore up its currency, which has shed over 3 percent since Friday.

But the dollar's gains faded as doubts surfaced whether these emergency efforts could offset the political and economic problems that could bog down faster-growing economies. That view muted any positive impact when South Africa later unexpectedly raised its policy rate. News Search ID:nL2N0L30VQ

The South African Reserve Bank became the third key emerging market central bank this week to tighten rates, raising its key rate by half a percentage point to 5.5 percent.

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Graphics:

Emerging market currencies Href="Link">http://link.reuters.com/jus35t

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The dollar index .DXY was little changed at 80.573.

In afternoon trading, the euro was at $1.3654 EUR= , down 0.1 percent, while the dollar fell 0.8 percent to 102.06 yen

, after touching a low of 101.83.

(Additional reporting by Richard Leong; Editing by James Dalgleish)

((michael.connor@thomsonreuters.com)(646 223 6309)(Reuters Messaging: michael.connor.reuters.com@reuters.net))

 
((     
    Currency bid prices at 03:03PM (2003 GMT) 
Description    RIC    Last    U.S. Close 
 Previous  
 Session    Pct Change    YTD Pct 
 Change    High Bid    Low Bid 
Euro/Dollar    EUR=    $1.3662    $1.3668    -0.04%    -0.60%    +1.3684    +1.3604 
Dollar/Yen    JPY=    102.0900    102.9500    -0.84%    -2.91%    +103.4400    +101.8600 
Euro/Yen    EURJPY=    139.48    140.70    -0.87%    -3.89%    +141.2500    +139.0500 
Dollar/Swiss    CHF=    0.8947    0.8971    -0.27%    +0.21%    +0.9009    +0.8937 
Sterling/Dollar    GBP=    1.6567    1.6577    -0.06%    +0.07%    +1.6606    +1.6527 
Dollar/Canadian    CAD=    1.1158    1.1147    +0.10%    +5.07%    +1.1186    +1.1103 
Australian/Dollar    AUD=    0.8744    0.8776    -0.36%    -1.90%    +0.8825    +0.8728 
Euro/Swiss    EURCHF=    1.2223    1.2265    -0.34%    -0.39%    +1.2297    +1.2215 
Euro/Sterling    EURGBP=     0.8246    0.8244    +0.02%    -0.61%    +0.8259    +0.8220 
NZ Dollar/Dolar    NZD=    0.8227    0.8254    -0.33%    +0.26%    +0.8297    +0.8220 
Dollar/Norway    NOK=    6.1670    6.1223    +0.73%    +1.66%    +6.2162    +6.1189 
Euro/Norway    EURNOK=    8.4221    8.3731    +0.59%    +1.00%    +8.4614    +8.3601 
Dollar/Sweden    SEK=    6.4570    6.4168    +0.56%    +0.54%    +6.4833    +6.4086 
Euro/Sweden    EURSEK=    8.8218    8.7727    +0.56%    -0.50%    +8.8299    +8.7576 
     
     
All spots FX=  
Tokyo spots AFX=  
Europe spots EFX=  
Volatilities FXVOL=  
Tokyo Forex market info from BOJ TKYFX World central bank news CEN 
Economic Forecasts... ECON   Official rates...INT/RATE 
Forex Diary.......MI/DIARY   Top events........M/DIARY 
Diaries...........DIARY Diaries Index........IND/DIARY 
Press Digests.....PRESS Polls on G7 economies..SURVEY/ 
European markets......MARKETS/))))

Keywords: MARKETS FOREX