FOREX-Euro edges up as crunch meeting on Greece gets underway

(Updates prices, adds New Zealand dollar)

* Odds on Greek deal to avoid "Grexit" this week

* Yen holds firm as BOJ stance becomes less outstanding

* New Zealand dollar up almost 1 percent

* U.S. markets closed on Monday for public holiday

By Patrick Graham

LONDON, Feb 16 (Reuters) - The euro inched higher on Monday as a meeting began of euro zone finance ministers who investors expect will find enough common ground to support Greece beyond its current bailout programme and keep it in the currency bloc.

In a day weakened by the absence of U.S. investors due to a national holiday, the New Zealand dollar was the biggest mover on major currency markets, gaining as much as 1 percent after a strong retail sales report.

The euro has risen steadily through a nervous month of deadlock between the new government in Athens and its international creditors in Europe and at the International Monetary Fund.

That, and the relative calm on debt markets in Spain, Italy and Portugal, suggests euro zone leaders might be risking less in letting Greece leave the euro now than they would have done during a previous standoff in 2012.

But at least for the time being, analysts seem more inclined to attribute the lack of a significant sell-off to confidence that ministers will find a way to satisfy both sides.

"This can quickly turn sour for the euro if there is no deal today," said Susanne Galler, strategist with Jefferies in London.

"The market consensus is for them to do a deal by the end of this week. But we think that if there's no deal today and the clock starts ticking, then the euro will look increasingly vulnerable."

The euro gained 0.2 percent against a broadly weaker dollar to trade at $1.1413. It was flat against the yen and 0.4 percent higher against Britain's pound.

Analysts from Barclays (LSE: BARC.L - news) said there would be more volatility ahead for the euro no matter the outcome and a Greek exit would be unambiguously negative for the euro zone.

"An agreement with significant concessions for Greece may raise the perception of risks in Spain, resulting in significantly greater downside risk for the euro," they said.

They also argue a Greek deal with little relief for austerity or debt could potentially boost the euro in the near term and slow its descent in coming months.

The dollar inched down 0.2 percent to 118.475 yen, from 118.70 at the end of last week and a one-month high of 120.48 set last Wednesday.

This week's Bank of Japan meeting is seen as unlikely to generate any new monetary easing, and positioning data showed speculators' net yen selling positions have shrunk to the lowest level since July. (Additional reporting by Jemima Kelly; Editing by Tom Heneghan)