FOREX-Euro stabilizes after German Italian elections

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* Euro bounces after German vote, Italian parliamentaryelection

* Positioning in long euro bets still near record

* Traders await U.S. jobs data; RBA, BOC, ECB, BOJ meetings (Updates market action, changes dateline, previous LONDON)

By Richard Leong

NEW YORK, March 5 (Reuters) - The euro edged higher onMonday after a short-lived sell-off tied to Italy's inconclusiveweekend election, helped by the creation of a coalitiongovernment in Germany that eased political uncertainty there.

Italy's election, which pointed to prolonged politicaljitters after right-wing and eurosceptic parties did better thanexpected, was somewhat balanced by Germany's Social Democratsagreeing to join with Chancellor Angela Merkel's conservatives,ending a period of uncertainty in Europe's biggest economy. urn:newsml:reuters.com:*:nL5N1QN0KMurn:newsml:reuters.com:*:nB4N1PQ007urn:newsml:reuters.com:*:nL5N1QM03A

Taken together, the election outcomes did not to alterinvestors' view on the strength of the euro zone economy,although the Italian results put political risks in the regionback on the radar.

"All in all, they are neutral to slightly positive for theeuro," said Nick Bennenbroek, head of currency strategy at WellsFargo Securities in New York.

Bennenbroek and other analysts said traders will turn theirfocus to four major central bank meetings this week as well asthe U.S. payrolls report due Friday.

The Reserve Bank of Australia will meet on Tuesday, whilethe Bank of Canada will hold a policy meeting on Wednesday.European Central Bank policymakers will convene on Thursday,while their counterparts at the Bank of Japan will meet onFriday.

The euro EUR= was last up 0.09 percent to $1.2328.

The single currency rose to a two-week high at $1.2365 inAsian trading after the German results. It quickly retreated by0.8 percent towards the day's low at $1.2267 as results fromItaly pointed to a messier outcome than expected - a strongshowing for anti-establishment parties and no group able to forma stable government.

The euro was up 0.31 percent to 130.65 yen. It had fallen asmuch as 0.7 percent to 129.37 yen, its lowest since late Augustin early London trading.

In an indicator of how sanguine currency markets were aboutItaly's turmoil, risk reversals in currency derivatives marketsfor euro/dollar EUR1MRR= were smaller than before France'selection verdict in May last year.

Even latest positioning data showed euro bulls remainedupbeat, with net long currency positions still near recordbullish bets in early February.

More worryingly from the euro's perspective, recent datashowed that economic momentum has stalled in the euro zone,indicating the single currency may be coming under somepressure. A Citi economic surprise index for the currency bloc .CESIEUR is at near six-month lows.

The dollar steadied after wobbling last week on U.S.President Donald Trump's proposed tariffs on imported steel andaluminum, raising fears of a trade war. urn:newsml:reuters.com:*:nL2N1QN0H8

The greenback JPY= strengthened 0.23 percent at 106.00yen. It hit a 16-month low of 105.23 yen on Friday.======================================================== ========================================================

Currency bid prices at 12:17PM (1717 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session Euro/Dollar EUR= $1.2329$1.2317 +0.10% +2.78% +1.2365 +1.2270 Dollar/Yen JPY= 105.9700 105.7300 +0.23% -5.95% +106.0000 +105.3600 Euro/Yen EURJPY= 130.64 130.24 +0.31% -3.36% +130.7600 +129.3700 Dollar/Swiss CHF= 0.9394 0.9380 +0.15% -3.58% +0.9402 +0.9348 Sterling/Dollar GBP= 1.3852 1.3802 +0.36% +2.52% +1.3876 +1.3768 Dollar/Canadian CAD= 1.2976 1.2878 +0.76% +3.17% +1.2988 +1.2872 Australian/Doll AUD= 0.7757 0.7762 -0.06% -0.56% +0.7778 +0.7727 ar Euro/Swiss EURCHF= 1.1584 1.1550 +0.29% -0.90% +1.1598 +1.1512 Euro/Sterling EURGBP= 0.8897 0.8921 -0.27% +0.16% +0.8951 +0.8885 NZ Dollar/Dolar NZD= 0.7227 0.7243 -0.22% +1.99% +0.7255 +0.7204 Dollar/Norway NOK= 7.8201 7.7834 +0.47% -4.71% +7.8507 +7.7614 Euro/Norway EURNOK= 9.6420 9.5895 +0.55% -2.10% +9.6582 +9.5834 Dollar/Sweden SEK= 8.2512 8.2473 +0.10% +0.60% +8.2910 +8.2366 Euro/Sweden EURSEK= 10.1730 10.1629 +0.10% +3.39% +10.1905 +10.1480

All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX World central bank newsCENEconomic Forecasts... ECON Official rates...INT/RATEForex Diary.......MI/DIARY Top events........M/DIARYDiaries...........DIARY Diaries Index........IND/DIARYPress Digests.....PRESS Polls on G7 economies..SURVEY/European markets......MARKETS/))

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EUR FX and positions   http://reut.rs/2FcSG1t
World FX rates in 2018   http://tmsnrt.rs/2egbfV
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(Reporting by Richard Leong in New York and Saikat Chatterjeein LondonEditing by Andrea Ricci) ((richard.leong@thomsonreuters.com; +1 646 223 6313; ReutersMessaging: richard.leong.thomsonreuters.com@thomsonreuters.net;Twitter @RichardLeong2))

Referenced Symbols:EFX,

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