0613 GMT - The dollar could extend gains against the euro if the recent widening in the French-German OAT-Bund spread persists, OCBC strategists say. "Wider peripheral spreads tend to tighten eurozone financial conditions and weigh on [euro] sentiment," OCBC's Sim Moh Siong and Christopher Wong say. Still, betting on a disorderly selloff in European bonds remains risky given the ECB's extensive antifragmentation toolkit. The bar for activation remains high, though OCBC reckons the ECB is unlikely to remain passive if market fragmentation intensifies. Near term, they view verbal intervention as the first line of defense should spreads widen further. OCBC's base case is for a moderate rather than aggressive dollar rally into year-end, as markets have pared expectations for an October Fed increase after several officials signaled no urgency to tighten.