By Swati Pandey
SYDNEY, March 5 (Reuters) - The dollar stayed on a slipperyslope on Monday amid fears of a global trade war, while the eurodipped briefly but rebounded quickly after results of exit pollsfor Italy's elections pointed to a hung parliament.
A centre-right coalition is set to win the most seats inItaly's parliament ahead of the anti-establishment 5-StarMovement, according to the exit polls, although it was unlikelyto produce an outright winner. euro EUR= level rose 0.3 percent to $0.1.2352, aftergoing as low as $1.2335 as the polls suggested a period ofuncertainty until a coalition government could be formed.
Also helping the euro was the revival of Germany's grandcoalition over the weekend, meaning Chancellor Angela Merkel'sconservatives will form a new government more than five monthssince the country's inconclusive election. euro also got a bit of a lift from safe-haven flows asrisk sentiment soured after U.S. President Donald Trump proposedtariffs on imported steel and aluminium, rattling financialmarkets last week.
The dollar fell for a fourth straight session to go as deepas 105.40 yen, but was slightly above Friday's low of 105.23, alevel not seen since November 2016. JPY=
Still, Wall Street rebounded late on Friday as investors whowere initially spooked by the prospect of a global trade warclung to hopes that Trump was just rattling sabres as anegotiating tactic.
News over the weekend suggested, however, that Trump wasgoing ahead with his plan, while there was no indication thatallies would be excluded from the tariffs.
Canada and Mexico have threatened retaliation, and theEuropean Union said it would apply 25 percent tariffs on about$3.5 billion of imports from the United States if Trump carriedout his threat. says the tariffs are needed to protect domesticindustries against unfair competition from China and elsewhere.
Analysts were not sure how Asian markets would react onMonday, although sentiment is likely to remain jittery.
The S&P 500 .SPX and Nasdaq .IXIC rebounded from lossesof 1 percent or more to close higher on Friday. The Dow .DJI ,however, ended lower and remained in negative territory for theyear so far.
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^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Peter Cooney)