* Dollar falls broadly; euro up 0.2 percent at $1.4271
* European equities rise 1.2 percent, oil prices above $70
* Sterling, Kiwi, Aussie at or close to multi-mth highs
* Below-forecast Barclays results weigh a little on euro
By Jessica Mortimer
LONDON, Aug 3 (Reuters) - The dollar fell broadly on Monday as stronger equities and oil prices continued to buoy sentiment, with perceived higher risk currencies such as sterling and the Australian dollar rising sharply.
These currencies hit multi-month highs as European shares rose 1.2 percent and oil prices were above $70 per barrel, keeping investor sentiment towards riskier assets buoyant.
Optimism has been building in the market following a better-than-expected U.S. gross domestic product reading on Friday, which lifted hopes that the global economy is over the worst of the downturn.
Below-forecast results from UK bank Barclays helped bring the euro off highs, however, with traders noting that its earlier failure to sustain a move above $1.43 also weighed on the single currency.
Barclays PLC announced results that fell short of expectations with an 8 percent rise in half-year profit as bad debts at Britain's second biggest bank almost doubled to offset buoyant earnings from its enlarged investment bank..
The euro was helped back into positive territory, however, after some good news on the euro zone economy, with revised figures showing the region's purchasing managers' index for manufacturing rose to 46.3 in July -- an upward revision from the provisional 46.0 -- from 42.6 in June.
This was the second biggest monthly rise in the series' 12-year history..
Market participants are awaiting the key U.S. ISM survey on manufacturing activity later in the day, while later this week central bank policy decisions are due in Australia, the UK and the euro zone.
"The Barclays results may have contained markets a little and people may be a little hesitant before today's U.S. ISM data," said Nordea currency strategist in Copenhagen Niels Christensen.
"But I still see the market positive on risk - it would need very negative numbers out of the U.S. to dent risk appetite," he said.
At 0848 GMT, the euro rose 0.2 percent against the dollar to $1.4271 after rising as high as $1.4310 on trading platform EBS, its highest since early June.
The dollar index, a gauge of the U.S. currency's performance against six other major currencies, fell 0.2 percent to 78.162.
Among currencies seen as higher risk, sterling rose 0.7 percent to a nine-month high around $1.6851, lifted by better-than-expected UK manufacturing PMI data.
The New Zealand dollar hit a 10-month high of $0.6665, while the Australian dollar also hit its highest since late September of $0.8400.
Traders said the Aussie was being supported by expectations that the Reserve Bank of Australia may drop a key reference on monetary easing at its policy meeting on Tuesday while keeping the cash rate unchanged at 3 percent.
"Ahead of many events this week such as economic data in the U.S. and earnings from major companies in Europe and Japan, investors largely stayed on the sidelines," said Yuji Saito, head of the forex sales department at Societe Generale in Tokyo.
"As long as the market will be able to cope with those economic events, it will likely keep its risk-taking stance," he said.
Firm risk appetite also weighed on the yen, with the euro up 0.4 percent at 135.42 yen, while the dollar gained 0.2 percent to 94.86 yen. (Additional reporting by Satomi Noguchi in Tokyo; editing by Stephen Nisbet)