* Euro dips but fall seen limited
* Gold hits another record, ETF holdings rise
By Saikat Chatterjee
HONG KONG, April 18 (Reuters) - Shares in Asia's developed
markets edged up and the high-yielding Kiwi dollar briefly hit a
three-year high on Monday as investors bet that China's latest
round of policy tightening would not derail hopes of a sustained
economic recovery.
China raised banks' reserve requirements for the fourth time
this year on Sunday. The move was not a surprise as market
players had predicted more tightening after last week's data
showed an acceleration in inflation. [].
But the policy action may temper heavy buying in Asian
equities which received a boost from a strong Wall Street close,
riding on the back of encouraging U.S. data.
Japan's Nikkei opened slightly up and Australia's
benchmark index was also up 0.1 percent. MSCI's index of
Asia Pacific shares outside Japan was flat,
weighed down by a decline in South Korean stocks .
"The market will probably open carefully today as it's near
a record high, and positive momentum currently is a bit weak
with China's policy moves," said Kim Soo-young, a market analyst
at KB Investment & Securities.
In currency markets, the euro dipped as traders grew
sceptical of a quick solution to the euro zone's festering debt
crisis after Finnish voters handed the anti-euro True Finns
party a crucial role in parliament and possibly into government.
[]
But the common currency is expected to be supported by
prospects of another interest rate hike after last week's
quarter point increase, as data showed euro zone inflation
climbed higher than expected in March. []
In contrast, the Fed is expected to continue with its ultra
easy policy stance, encouraging investors to search for
high-yielding currencies such as the New Zealand dollar .
The kiwi broke through resistance at the November high of
$0.7976 to briefly touch $0.80 for the first since April 2008.
In commodities, gold rose to yet another record high,
building on four consecutive weeks of gains, powered by rising
inflation pressures and a weakening dollar. Holdings in the SPDR
Gold Trust , the world's largest gold-backed
exchange-traded fund, rose too. []
U.S. crude futures <CLc1> headed lower towards $109 a barrel
as traders took profits after three days of gains despite
comments by Saudi Arabia confirming a cut in crude production to
counter an oversupplied market. Prices have retreated slightly
after hitting a 2-1/2 year peak of $113.46 earlier this month.
Notwithstanding the commodities rally, U.S. Treasury yields
declined as recent data showed underlying U.S. inflation
pressures remained subdued. Ten-year yields edged a
basis point lower to 3.40 percent after falling 9 basis points
on Friday.
* For Reuters Global Investing Blog, click on
http://blogs.reuters.com/globalinvesting
* For the MacroScope Blog, click on
http://blogs.reuters.com/macroscope
* For Hedge Fund Blog, click on
http://blogs.reuters.com/hedgehub
(Additional reporting by Jungyoun Park in SEOUL and Ian Chua in
SYDNEY; Editing by Alex Richardson)
