* Greenback off recent highs as U.S. Treasury yields pull back
* Volatile oil prices ahead OPEC meeting damp risk sentiment
* Italian political woes, bank concerns weigh on euro
TOKYO, Nov 29 (Reuters) - The dollar clawed back some losses on Tuesday as Italian political woes weighed on the euro, though the greenback remained shy of recent highs after U.S. Treasury yields stepped back from multi-month highs.
Volatile crude oil prices ahead of this week’s oil producers’ meeting kept investors’ risk appetite in check. The Organization of the Petroleum Exporting Countries (OPEC) will gather in Vienna on Wednesday to discuss a planned output cut in an effort to curb a supply glut.
Political risks helped drag down the euro from its nearly two-week high of $1.0686 touched overnight. It last traded at $1.0599, down 0.2 percent from late Monday’s North American levels.
Worries about Italy’s banking system have been mounting ahead of a Dec. 4 referendum on constitutional reform, which could unseat the government of Prime Minister Matteo Renzi.
“Renzi is not obligated to step down, but has said he intends to if he loses, which has weighed on the euro,” said Ayako Sera, senior market economist at Sumitomo Mitsui Trust.
Italian lender Monte dei Paschi di Siena faces more than 8 billion euros of legal claims, and says its weakening liquidity and the potential for more bad loan writedowns are among risks to its 5-billion-euro rescue plan.
The dollar index, which tracks the greenback against a basket of six major rivals, scaled a nearly 14-year peak of 102.050 on Thursday before profit-taking and oil price jitters brought it back down to earth. It was last at 101.290, steady on the day.
Since the victory of U.S. President-elect Donald Trump on Nov. 8, the dollar has soared in line with yields on U.S. Treasury bonds, which have sold off on expectations that the Trump administration will embark on stimulus policies and boost inflation.
These expectations helped push up the benchmark 10-year Treasury yield to a 16-month high of 2.417 percent last week, and the 2-year yield to a 6 1/2-year high. On Tuesday, the 10-year U.S. yield stood at 2.312 percent, down from its U.S. close on Monday of 2.320 percent.
The dollar edged up 0.1 percent to 111.99 yen, off its overnight low of 111.35 but well below an 8-month high of 113.90 touched on Friday.
“The dollar has been pulling back now in response to volatile oil prices, after rising on expectations of what Trump will do,” said Mitsuo Imaizumi, chief currency strategist at Daiwa Securities in Tokyo.
“Against the yen, it could even fall back to the 110 level, depending on what oil does, and we also have U.S. data this week - although right now, the employment figures seem like a long time away,” he said.
Crude prices have been on a roller coaster ride as the market reacted to the developments on whether major producers would be able to reach an agreement on the contentious issue of trimming their production.
Later on Tuesday, investors will look to U.S. third-quarter gross domestic product data as well as readings on consumer confidence and consumption for trading cues. They will be followed by the November employment report on Friday.
Data released early on Tuesday showed that Japan’s unemployment rate in October held steady as the availability of jobs improved and household spending fell at a slower pace, a tentative sign that a robust labour market is lending support to domestic demand. (Reporting by Tokyo markets team; Editing by Shri Navaratnam)