The euro edged away from a two-week low while oil and European equities stayed close to multi-month highs on Monday, as worries over political developments in Europe were offset by signs of a pickup in world trade.

However, activity was light in the absence of any major economic drivers and after the Lunar New Year holiday shut most Asian financial centres, with the focus on an upcoming meeting of euro area finance ministers.

Analysts were not expecting much to come from the meeting, but after comments by the president of the European Central Bank Mario Draghi last week about the euro's rise, they are on watch for any talk about the currency's recent strength.

Political scandals in Spain and Italy, signs of tensions between the core European partners France and Germany, and worries about a Cyprus bailout are also weighing on the positive sentiment towards European assets seen since the start of 2013.

The euro edged up 0.1 percent to $1.3380 on Monday, though in Asian trade earlier it touched a two-week low of $1.3325 as it extended the sell-off that knocked around 2.5 percent off its dollar value last week.

Sentiment towards the euro has shifted since it hit a 15-month high of $1.3711 on Feb. 1, a shift given extra momentum last week when European Central Bank president Mario Draghi suggested further strength could lead to an interest rate cut.

Draghi's comments came at a time of rising concern in the markets over the prospect for "currency wars" as major trading nations try to boost their export competitiveness.

"What we saw last week was what amounted to verbal intervention from Mario Draghi on the euro," said Mike Ingram, market commentator at BGC.

Fears about competitive devaluations were further heightened when Asian Development Bank president Haruhiko Kuroda, a front runner to be the next Bank of Japan governor, voiced his support for a weaker yen on Monday. On Friday Venezuela devalued its currency by 32 percent.

"There are no winners ultimately from currency wars, but what we will see in the meantime is a lot of appreciating emerging market currencies," Ingram said.

However, strategists said moves in the major currencies were likely to be curtailed by the approach of a G20 meeting in Moscow later in the week, where policymakers could air their concerns about the recent sharp moves in the yen and the euro.

"The prospect of an international currency war has become an increasingly common topic of discussion in the press recently. As policy makers gather for the G20 this week, we expect this chatter to increase," said Sara Yates, Global Currency Strategist, J.P. Morgan Private Bank.

TRADE SUPPORTS

Equity markets were mostly holding on to sharp gains at the end of last week when better U.S. and China trade figures bolstered hopes of a stronger global economic recovery.

The pan-European FTSEurofirst 300 index traded down 0.1 percent at 1,160 points by mid-morning, having added 1.2 percent on the trade news. London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX were up between 0.1 and 0.5 percent.

U.S. stock index futures pointed to a higher open on Wall Street where stocks ended up for a sixth straight week on Friday, with the benchmark S&P 500 index at a five-year high.

Crude oil prices also got a boost from the trade numbers, which included data showing China's oil imports running at their third highest rate on record.

Brent crude had hit a nine-month high of just over $119 per barrel on the Chinese numbers, its highest level since last May, but the price dipped by 24 cents on Monday to $118.66 a barrel . U.S. crude futures fell 9 cents to $95.63.

Oil markets could get some support from stormy weather in the heavily populated U.S. Northeast, where a blizzard dumped up to 40 inches (1 metre) of snow with hurricane force winds, leaving hundreds of thousands of people without power.

Gold edged up to a high of $1,669.31 an ounce, while platinum and palladium hovered below their strongest levels in 17 months, but traders said activity was curtailed by the Lunar New Year break.

"We could see (gold) push up a little higher, probably to $1,672.90. And the bottom is probably around $1,665. It's a very narrow trading range," said Nick Trevethan, senior metals strategist at ANZ Bank.