* Dollar slips broadly, still smarts from BRICs comments
* Euro up on recovering oil but sluggish shares cap gains
* Analysts say currencies in consolidation phase
(Updates throughout; previous TOKYO)
By Naomi Tajitsu
LONDON, June 17 (Reuters) - The euro edged up on Wednesday, tracking a recovery in oil prices, while the dollar slipped after BRICs support for more a diversified monetary system kept in focus the issue of the dollar's suitability as the world's reserve currency.
The dollar index fell for the second consecutive day but losses were limited by a slide in European shares, which tempered demand for risk and kept a lid on gains in currencies including the Australian and New Zealand dollars.
"The BRICs were asking for a more diverse monetary system; that would explain some of the dollar weakness," said Martin McMahon, currency strategist at Credit Suisse in Zurich.
He said currency movements were limited in early European trade and that the market had entered a consolidation phase as investors looked for more signs that the worst of the global economic downturn may be over.
By 0756 GMT, the euro traded 0.5 percent higher at $1.3912, after rising as high as around $1.3925. The single European currency has been trading in narrow ranges this week as traders have been hesitant to push the pair higher following steep gains posted last month.
The pair rose to the day's high as U.S. crude oil prices rose as much as 1 percent on the day, recovering from three straight days of losses. But further gains were capped due to a 0.5 percent slide in European shares.
The dollar index was down 0.3 percent, while the U.S. currency was little changed against the yen at 96.40 yen.
Higher oil prices prodded the Australian and New Zealand dollars each up more than half a percent against the dollar, while they also rose against the yen, which suffered broadly.
The dollar was on the back foot after leaders of the emerging BRICs nations -- Brazil, Russia, India and China -- at a summit on Tuesday argued for a greater say in the international finance system, while underlining the need for a more diversified monetary system.
A communique from the meeting made no mention of support for a smaller role for the dollar and a supranational reserve currency, after the Kremlin had said beforehand that the need for more reserve currencies would be discussed at the gathering.
The status of the dollar's role as the main reserve currency has been in focus after Moscow last week said it would cut the amount of U.S. Treasuries it held.
Euro zone trade figures for April were due later but with few other major local economic data and events slated for Wednesday, traders awaited a reading of U.S. inflation and mortgages later in the day.
U.S. core CPI is seen rising 0.1 percent in April, which would be the smallest rise this year. This would suggest that inflation pressures remain subdued and may quell some speculation for a rise in U.S. interest rates by year-end. (Reporting by Naomi Tajitsu; editing by Mike Peacock)