Sterling up vs dollar after latest election poll

* Sterling up 0.3 pct vs dollar at $1.5103; steady vs euro

* Opinion poll eases concerns about political uncertainty

* BoE MPC member Dale speaks at 1100 GMT

By Jessica Mortimer

LONDON, March 12 (Reuters) - Sterling rose against the dollar on Friday after an opinion poll suggested the Conservatives would win an outright majority in a general election expected in May.

A poll of decided voters by Angus Reid showed the opposition Conservatives gaining 39 percent of the vote, with the Labour Party on 26 percent.

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Investors remained cautious, however, as most recent polls have suggested the election could result in a hung parliament, potentially hampering any incoming government's efforts to cut the UK's ballooning budget deficit.

"Sterling has been driven overwhelmingly by politics recently," RBC currency strategist Adam Cole said.

"The bias has been towards sterling trading poorly due to evidence that the election will result in a hung parliament."

At 0905 GMT, sterling was up 0.3 percent against the dollar GBP=D4 at $1.5103.

However, the pound failed to make gains against the euro EURGBP=D4, which was steady at 90.81 pence.

"The November and December 2009 highs at 91.50 pence are the key barriers to further euro upside here. Last week's rally stalled at this level and remains the key barrier to further sterling losses," CMC Markets analyst Michael Hewson said in a note to clients.

The pound extended gains on Thursday after a Bank of England survey showed Britons' expectations for inflation over the next 12 months rose slightly, although investors remained wary about a weak economic outlook in the UK.

Earlier this week, sterling skidded to one-week lows against the dollar and euro after data showing below-forecast manufacturing output and a sharp fall in UK exports.

With nothing of note on the UK data calendar, market players were awaiting a speech by Bank of England Monetary Policy Committee member Spencer Dale at 1100 GMT. [MI/DIARY]

Data releases in the UK are sparse ahead of BoE minutes and employment data due next Wednesday.

(Reporting by Jessica Mortimer)