* Euro edges down after marking three-week high
* Dollar steadies against yen after moderate drop
* Some still bet on U.S. rate hike this year
By Lisa Twaronite
TOKYO, Sept 18 (Reuters) - The dollar took back some lost ground in Asian trading on Friday after skidding to three-week lows against the euro and a basket of currencies after the Federal Reserve held interest rates steady and cut its long-term U.S. growth outlook.
Opinions had been divided over whether the Fed would raise rates on Thursday for the first time since 2006, and the announcement triggered broad dollar losses, though the central bank left open the possibility of a modest policy tightening later this year.
The euro gained more than 1 percent to a three-week high of $1.1441 EUR= and was last at $1.1401, down about 0.3 percent from late U.S. levels but still well above Wednesday's one-week low of $1.1214.
The dollar index .DXY , which tracks the greenback against a basket of six major currencies, stood at 94.632, edging up about 0.1 percent after dropping as low as 94.360, its lowest since Aug. 26.
The dollar steadied against the yen after a more moderate decline. It was buying 120.18 yen JPY= in early Asian trade, slightly above late U.S. levels after falling as low as 119.80 yen overnight in the wake of the Fed's more downbeat assessment.
"Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term," the U.S. central bank said. ID:nL1N11N244
The latest count put 13 of 17 Fed policymakers expecting to raise interest rates in 2015, down from 15 at the bank's June meeting. Four policymakers, up from two, now believe the bank should stand pat until at least 2016.
"With the overwhelming majority in the FOMC still expecting to hike this year, and the domestic economy maintaining its momentum, we stick to our call of a December rate hike," strategists at Rabobank said.
"Although Yellen said that October remains a possibility, we doubt that the economic data between now and then will be sufficient to hike," they said in a note to clients.
Rates futures FFU5 placed an 18 percent chance that the U.S. central bank would end its near-zero interest rate policy in October, down from 41 percent Thursday morning, according to CME Group's FedWatch program.
The Australian dollar AUD=D4 edged up 0.1 percent to $0.7182 with investors focused on parliamentary testimony by Reserve Bank of Australia Governor Glenn Stevens.
(Editing by Kim Coghill)