(Adds sterling jump on inflation, more comment, updates prices)
* Centrist Macron seen as victor in marathon TV debate
* Euro up 0.6 percent to six-week high
* Dollar index dips below 100, first time since early Feb
* Sterling surges after higher inflation print
* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh
By Patrick Graham
LONDON, March 21 The euro rose above $1.08 for
the first time in six weeks on Tuesday as centrist
Emmanuel Macron's performance in a TV debate fuelled
expectations he would win the French presidency ahead of
far-right rival Marine Le Pen in May.
After four days of trading focused chiefly on expectations
for U.S. interest rates and the Trump administration's attitude
to trade and a stronger dollar, the euro's gains also sent the
dollar index to a six-week low.
A cautious line from Federal Reserve speakers since it
raised rates last week has added to signs the Trump team will
have to take its time in delivering a promised fiscal boost to
There has also been an easing of some of the perceived
political risks to the euro from populists such as Le Pen, who
wants to take France out of the single currency, and speculation
the European Central Bank will rein in its ultra-loose monetary
policy later this year.
A snap opinion poll after Monday's debate showed Macron, a
former economy minister who has never run for public office
before, was seen as the most convincing among the top five
contenders for the French presidency.
"The euro has been helped by Macron's performance
definitely," said Stephen Gallo, head of European FX strategy at
Bank of Montreal in London.
"I still want to buy dollars but not here. I think there
will be a push higher in euro dollar in the very short run,
before we would look for levels to be selling."
The euro rose 0.6 percent to $1.0808 by 1134 GMT.
That pushed the index used to measure the dollar's broader
strength below 100 for the first time since early
The euro was also 0.7 percent higher against the yen.
Sterling, a target for investors this year due to nerves
over the UK economy's performance in the face of its planned
departure from the European Union, jumped almost 1 percent
after higher than expected inflation data.
Signs price rises are beginning to outstrip wage gains bodes
ill for household budgets and consumer spending but also fuel
expectations that the Bank of England may be forced to raise
interest rates to support the pound.
The Bank's meeting last week shocked markets by showing one
outgoing policymaker already switching to vote for higher rates
and others on the verge of following if inflation and inflation
expectations continue to rise.
"With the BoE now indicating it could raise rates much
sooner than markets were expecting ... future downside for the
pound now looks far more limited, especially as it's the pound's
depreciation that has generated much of the inflationary
pressures," said Oanda market analyst Craig Erlam.
Sterling rose almost 1 percent to a three-week high of
$1.2474 in morning trade in London. It inched up 0.2
percent to 86.73 pence per euro.
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
(Writing by Patrick Graham; Editing by Mark Trevelyan/Keith