* Options pricing still shows concern over election
* Dollar index firms off week's lows
* C$ weakens as cooler inflation slams rate hike talk
(Updates with U.S. market open; changes dateline from LONDON)
By Saqib Iqbal AhmedNEW YORK, April 21 (Reuters) - The euro edged lower against
the U.S. dollar on Friday as investors braced for Sunday's first
round of a tight French presidential election.
The euro was down 0.2 percent against the dollar at $1.0693,
close to the session's low.
"Traders understandably look content to flatten their books
and ride out the weekend's events from the sidelines," Omer
Esiner, chief market analyst at Commonwealth Foreign Exchange in
Washington, said in a note.
While the risk of a knee-jerk move one way or the other
remained high, the euro was still on pace for its best week in
11 against the dollar.
An upbeat Purchasing Managers' Index survey from France and
polls showing centrist Emmanuel Macron still in pole position
ahead of the vote helped settle investors' nerves. [nU8N1D302M]
"We did see a decent amount of unwinding of some hedges,"
said Brad Bechtel, managing director FX at Jefferies in New
York. "Hedges have appreciated so much in the last week or so
that some folks are comfortable taking a little bit off."
However, the options markets <EURVOL=> still suggests
investors are concerned about the chances of strong results for
far-right candidate Marine Le Pen and far-left rival Jean-Luc
The dollar, which has been pressured lately by
weaker-than-expected economic data and worries about the Trump
administration's ability to pass tax and fiscal stimulus
legislation, rose on Friday as traders squared up positions
ahead of the weekend.
The dollar index, which tracks the U.S. currency against a
basket of six major rivals, was up 0.18 percent at 99.954.
"Even if we don't get the Trump administration stuff, we
still have a Fed that is hiking rates, balance sheet reductions
still on the cards and the U.S. economy is still trucking
along," Bechtel said. "All these things are still generally
Against the yen, the greenback was down 0.33 percent at
The Canadian dollar <CAD=> weakened against its U.S.
counterpart to a six-week low as cooler-than-expected domestic
inflation reduced pressure on the Bank of Canada to consider
interest-rate hikes. [nL1N1HT0HA]
Other major currency pairs were stuck in tight ranges, with
Britain's weakest quarterly retail sales number in five years
doing minimal damage to sterling after a 4-cent surge earlier
this week. Sterling was down 0.2 percent at $1.2782.
Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh
(Editing by Lisa Von Ahn)
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Keywords: GLOBAL FOREX/ (UPDATE 4)