* Euro pulls away from Thursday's 8-mth low vs dollar * Profit-taking and stops add to rise in euro * Goldman stopped out in long euro/dollar recommendation (Adds comments, updates prices) By Anirban Nag LONDON, Sept 23 (Reuters) - The euro inched up on Friday, taking a breather from a sell-off that saw it fall to an eight-month low against the dollar the previous day, but its gains could prove fleeting with investors looking to sell into the bounce. While a G20 pledge to prevent Europe's debt crisis from undermining banks and financial markets boosted the euro, traders saw little willingness to initiate fresh positions amid considerable risks from the IMF-World Bank and G-20 meetings in Washington over the weekend. The euro was up 0.5 percent at $1.3521 , having hit $1.3567 earlier, and well above an eight-month low of $1.3384 hit on Thursday on trading platform EBS. Offers from Asian central banks were said to be building above $1.3550-90. The euro's gains pulled the dollar index from a seven-month high of 78.798. It was last down 0.35 percent at 78.184. "Today we should see fairly sideways trading in the euro after a tumultuous day on Thursday," said Gavin Friend, currency strategist at National Australia Bank. "The markets are fairly anxious and while the G20 does refer to euro zone officials looking to enhance the EFSF, there is a fair bit of gloom out there." He added the outlook for the euro could look up from the middle of next week when member states start ratifying the increase of the euro zone's bailout fund and Greece edges towards securing the next tranche of its bailout funds. Finance ministers and central bankers from the Group of 20 said the EFSF rescue fund would be bolstered and that they would take all steps needed to ease the stresses that are wracking the global financial system. However, investors including Asian central banks were looking to sell the euro. On Thursday, a number of leveraged positions were wiped out after the U.S. Federal Reserve flagged significant downward risks to the economy on Wednesday. Traders said that unless markets stabilised, most would seek to trim risk exposure for the relative safety of the dollar and yen. Both rallied on Thursday as investors bailed out of crowded trades in commodity- and growth-linked currencies. Goldman Sachs said it was stopped out of its long euro/dollar position following the single currency's drop below its closing stop of $1.35. Goldman had issued a long euro short/ dollar recommendation in March 2011 when the euro was at $1.4085 and had set a target of $1.50. WORRIES ABOUT A SLOWDOWN Dealers said some investors were rushing to take profits where they could to cover losses elsewhere, while others had decided to take their money home to preserve capital. "With no immediate circuit breaker on the horizon, investor confidence is quickly evaporating, which is increasing the risk of a financial market crash developing in the coming months," Bank of Tokyo Mitsubishi UJF said in note. "In these circumstances, the safe-haven currencies of the yen and U.S. dollar should continue to outperform against more cyclically sensitive, commodity-linked G10 currencies." Thursday's rally in the dollar index had stalled just above the 200-week moving average at 78.758, and a clear breach of that resistance could set the dollar index up for more gains. The yen pulled back from a 10-year high struck versus the euro the previous day. The euro rose 0.4 percent against the yen to 103.05 yen , having bounced back from Thursday's trough of 102.211 yen, euro/yen's lowest in more than 10 years. The dollar held steady at 76.28 yen , hovering near a record low of 75.941 yen hit in August. Trading in the pair was thin with Tokyo markets closed for a national holiday but Japan repeated its threat of currency intervention. Meanwhile, the Australian dollar -- a proxy for global growth --rose more than 1 percent to $0.9865 . On Thursday, it hit $0.9692, its lowest in nearly 10 months. (Additional reporting by Masayuki Kitano; in Singapore; Editing by Nigel Stephenson)

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