LONDON, May 6 Reuters The dollar edged down on Friday but remained near 20year highs against major peers, while the euro jumped on European Central Bank members talking up a return to positive rates this year.

The safe haven greenback has broadly strengthened in recent weeks in response to global recession fears, and on bets that the Federal Reserve will tighten monetary policy faster than others to stem runaway inflation.

But after hitting a fresh 20year high of 104.07 earlier in the trading session, the dollar index lost momentum and was last down 0.3 at 103.29.

The fall was partly explained by gains made by the euro, which gained as much as 0.6 on the day. The euro was last up 0.5 at 1.0587.

The single currency was lifted by comments made by French central bank chief Francois Villeroy de Galhau, who said the ECB should raise its deposit rate back into positive territory this year.

The ECB has been moving slowly to remove support this year, but record inflation has prompted more members to call for action.

ECB policymaker Joachim Nagel, who heads Germany39;s Bundesbank, also indicated support for a move sooner rather than later in separate comments on Friday, saying the ECB39;s window for raising rates was slowly closing.

It looks like the ECB is preparing the ground now to deliver a rate rise in July, which looks increasingly like the base case scenario. It doesn39;t look like it will be one and done this year either, said Lee Hardman, currency analyst at MUFG….