* Euro near six-month highs
* Renewed oil price drop dents commodity currencies
* Aussie hits 4-month low; Canadian dollar sets 14-month low
* Yen edges higher on risk aversion
* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh
By Ritvik Carvalho
LONDON, May 5 The euro touched six-months highs
on Friday but was unable to break above $1.10 before this
weekend's final round of the French presidential election, while
a fall in oil prices drove the Australian dollar and Canadian
dollar to new lows.
Expectations that centrist Emmanuel Macron will become
France's next president and see off far-right candidate Marine
Le Pen have underpinned gains for the euro of nearly 2.5 percent
over the past two weeks.
The single currency touched a six-month high of $1.0990
in early morning trade in Europe as Macron extended his
lead in the polls over Le Pen, who has said she would withdraw
France from the euro. It later shed some of those gains to trade
0.1 percent lower at $1.0968, still up 0.8 percent for the week.
An Elabe poll overnight showed Macron extending his lead to
24 percentage points, up three points compared to the equivalent
Valentin Marinov, head of G10 FX strategy at Credit Agricole
in London said the easing of political risk in Europe, should
Macron win, could support the euro going forward.
A Macron win, he said, "will allow investors to refocus
their attention on the rather resilient euro zone fundamentals
at the moment, the improving growth outlook picture as a whole
and indeed the fact that the European Central Bank will take
more steps ever closer to tapering its quantative easing
The Canadian dollar set a 14-month low and the Australian
dollar hit a four-month trough on a drop in oil prices, while
the safe haven yen edged higher as risk sentiment wavered.
The loonie slipped to C$1.3793 per U.S. dollar at
one point, its weakest level since late February 2016. It was
last down 0.2 percent at C$1.3775.
The Australian dollar slid to $0.7368 at one point,
its lowest level since Jan. 11, last trading at $0.7391, down
0.2 percent on the day.
Commodity-linked currencies took their cues from a slide in
oil prices, said Stephen Innes, a senior trader for FX broker
OANDA in Singapore.
"I think that's really driving it... It's just a direct
correlation with oil prices and a little bit of risk aversion
coming into the dollar/yen," Innes said.
U.S. West Texas Intermediate (WTI) crude oil futures
slid 3 percent on the day.
The dollar fell 0.2 percent against the yen to 112.27
, pulling away from a seven-week high of 113.045 yen set
Investors are awaiting Friday's U.S. non-farm payrolls
report for additional insight into the Federal Reserve's likely
interest rate trajectory through the end of the year.
Attention will also be on officials including Fed Chair
Janet Yellen and Vice Chair Stanley Fischer, who are due to
speak on Friday.
The Federal Reserve kept interest rates unchanged on
Wednesday and downplayed weak first-quarter economic growth,
bolstering market expectations for the central bank to raise
interest rates in June.
For Reuters Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Reporting by Ritvik Carvalho; additional reporting by Tokyo
Markets Team; Editing by Mark Trevelyan)