FOREX-Dollar on the back foot; euro gains before ZEW

(Changes dateline, byline, adds quotes, updates prices)

By Veronica Brown

LONDON, May 20 (Reuters) - The dollar weakened broadly on Tuesday against a basket of six major currencies, pressured by persistent jitters about the U.S. economic outlook and oil prices neared record highs.

The common European currency rose after figures showing German producer prices had sped to a 20-month high in April kept expectations for steady ECB rates intact. The next focus is on German ZEW sentiment data later in the day that could support the single currency further.

The dollar had been boosted on Monday after the private U.S. Conference Board's leading indicator index showed a rise of 0.1 percent in April to match the increase in March, which followed five straight months of declines.

But while that data backed those arguing the U.S. slowdown may be near to bottoming out, others were wary that further fallout from the global credit crunch would leave the economy mired in slowing growth and higher inflation.

Oil price resilience was also seen placing a further strain on the U.S. currency as its economy is a major consumer of crude.

"There's a growing sentiment that even though we've seen some marginal upside surprises in U.S. data over the past few weeks, things are not as positive as they may seem with respect to the outlook for the U.S. economy," SocGen currency strategist Phyllis Papadavid said.

"There's still a lot of uncertainty around the household sector, the consumer and what the impetus for growth is likely to be ... and you have a Fed that is starting to be a little bit more concerned about inflation and not as willing to ease monetary policy to support growth," she added.