FOREX-U.S. dollar tumbles broadly after Fed minutes
* Dollar falls from three-year high vs basket of currencies
* Fed minutes say more jobs needed before tapering
NEW YORK, July 10 (Reuters) - The dollar tumbled against the euro and yen on Wednesday after the minutes from the Federal Reserve's latest policy meeting dented expectations of a near-term reduction in stimulus by the U.S. central bank.
The dollar had rallied to three-year peaks against a basket of major currencies on Tuesday on bets the Fed may start slowing its $85-billion-a-month bond purchases as early as September, but the minutes suggested that might not be a sure bet.
Even as consensus built within the Fed in June about the likely need to begin pulling back on economic stimulus measures soon, many officials wanted more reassurance the employment recovery was on solid ground before a policy retreat.
"The minutes were not as hawkish as expected," said Joseph Trevisani, chief market strategist at WorldWideMarkets, in Woodcliff Lake in New Jersey.
The euro rose 0.8 percent to $1.2887, after hitting a session peak of $1.2945 after the release of the minutes, according to Reuters data.
The dollar fell 1 percent to 100.18 yen after reaching a session low of 99.62 yen.
The Fed's bond-buying program, known as quantitative easing, has pressured the dollar in recent years because it equates to printing money and erodes the value of the currency.
Hopes the Fed may slow its purchases grew after Fed Chairman Ben Bernanke said in June that the central bank would likely curtail bond purchases later this year and bring them to a halt by the middle of next year.
Analysts at Action Economics said the minutes injected uncertainty back into the markets rather than provide clarity, as reflected by the gyrations in asset prices on the headlines.
Bernanke in the late afternoon addressed a conference sponsored by the National Bureau of Economic Research, but made no direct reference to current monetary policy in his speech.
The Fed chief began with a spoiler alert that he would leave any observations about current policy to an audience question-and-answer session at the end of his speech, as well as to two days of congressional testimony that he will deliver next week.
The dollar index, which tracks the greenback against a basket of six currencies, was last down 0.7 percent at 84.018, moving away from a three-year high at 84.753 touched on Tuesday.
Despite the weakness, some analysts believe the U.S. dollar looks poised to resume its rally on contrasting monetary policy stance between the Fed and other major central banks.
They said discussions about the Fed have focused squarely on the timing of a reduction in stimulus, while central banks in the euro zone, UK and Japan remain biased for further easing.