FOREX-Dollar inches lower vs high-yielders after Fed

TOKYO, Aug 13 (Reuters) - The dollar edged lower on Thursday after the Federal Reserve painted a less gloomy outlook for the U.S. economy, an assessment that led investors to return to commodity-linked currencies.

The Fed said it would slow the pace at which it buys Treasuries by extending the duration, but not the size, of its $300 billion programme to buy long-term government securities. [ID:nN1272730]

The U.S. central bank also kept interest rates near zero and said they would likely stay there for an extended period, which dealers said scaled back some market speculation that the Fed might raise rates soon.

"The Fed move basically did not have enough impact to alter the market trend of funds flowing into riskier assets," said Kazuyuki Kato, treasury department manager at Mizuho Trust & Banking.

"The prospect that the Fed will keep rates low will likely be one factor causing dollar weakness in the long term," he said.

The euro was firmer EUR= as were other high-yielding currencies like the Australian and New Zealand dollars, which made impressive gains against the greenback and the yen after being sold-off aggressively in the past few sessions.

The euro rose 0.3 percent from late U.S. trade on Wednesday to $1.4227 EUR=.

The Aussie was up 0.2 percent at $0.8352 AUD=D4, having fallen as low as $0.8180 on Wednesday, while the kiwi advanced 0.2 percent on the day to $0.6730 NZD=D4 and up from Wednesday's trough of $0.6599.

The dollar edged down 0.1 percent to 95.96 yen JPY= after rising to 96.80 yen on trading platform EBS the previous day.

The U.S. currency's upside against the yen seems to be capped due to talk of dollar-selling by Japanese investors repatriating funds related to $27 billion in coupon payments on U.S. Treasuries due on Aug.15. In addition, $61 billion in coupon securities mature on the same day.

Analysts said that while sentiment towards riskier assets improved, there was a general degree of caution on the Fed's move to extend the time frame of asset purchases as it indicated the economy was still vulnerable.

"I guess that leaves its options open just in case the improved economic outlook turns out not be blemish free," said David Watt, senior currency strategist at RBC Capital. "The Fed is strategically taking a middle road with the BoE on one wing and Norges Bank on the other."