RTRS: US dollar falls after Bernanke; Aussie hits parity
* Fed Chairman Bernanke sees case for more policy easing
* Aussie dollar rises above parity for 1st time since 1983
* Euro eyes $1.4374; 76.4 pct retrace of 2009-2010 drop (Updates prices, adds quote, changes byline, dateline, previous LONDON)
By Wanfeng Zhou
NEW YORK, Oct 15 (Reuters) - The U.S. dollar hit its lowest in more than eight months against the euro on Friday, while the Australian dollar surged above parity versus the greenback after Federal Reserve Chairman Ben Bernanke reinforced expectations of further monetary policy easing.
Analysts said the dollar may see further weakness in the near term although they said the downside may be limited as much of the impact from additional Fed easing has been priced in and bearish sentiment on the dollar has reached extreme levels.
Bernanke said on Friday high unemployment and low inflation point to a need for a further easing of U.S. monetary policy, but said policymakers were still weighing how aggressive they should be. For more see [ID:nLDE69E1EV].
"He confirmed that their position is dovish. The currency markets reacted in kind, with the Aussie hitting parity," said Boris Schlossberg, director of research at GFT in New York.
"Everything we've seen economically and from officials points to a weak dollar. The only question left is the size and scope of QE," he added, referring to quantitative easing, a phrase the Fed uses for adding to the money supply to bring down interest rates and stimulate the economy by buying bonds.
The euro rose as high as $1.4161 on trading platform EBS EUR=EBS, the highest level since January. It last traded at $1.4081, little changed on the day as traders took profits on the currency's earlier gains. Analysts said investors will continue to sell the dollar on any bounce.
Upside targets for the euro include a late January high at $1.4195 and then $1.4374, the 76.4 percent retracement of the euro's slide from its November 2009 peak down to a trough hit in June.
Weakness in the U.S. currency pushed the Australian dollar above the $1 parity level earlier on Friday for the first time since the Aussie was floated in 1983. [ID:nN15180428]
Australia's higher rates and robust resource-driven growth have boosted the currency in recent months.
The dollar index .DXY, which tracks the greenback versus a basket of six currencies, was down 0.2 percent at 76.490, after falling as low as 76.144, the weakest in 10 months.
