* Commodities extend gains; China trade data strong
* Rate expectations hit euro zone bonds
* World stocks flat to lower
By Jeremy Gaunt, European Investment Correspondent
LONDON, April 11 (Reuters) - Commodities prices rose on
Monday, pushing the Reuters-Jefferies CRB index <.CRB> to a
fresh two-and-a-half year high on a weaker dollar and strong
trade data from China.
Expectations of another European Central Bank rate hike by
July kept the euro close to recent highs and pushed euro zone
government bond yields higher.
World stocks were weaker, hurt to some extent by higher oil
prices.
Although the world economy is fairly robust, there are
growing expectations among investors that accompanying higher
commodity prices will drive up inflation and prompt central
banks to tighten monetary policy sooner.
Oil prices dipped on Monday on hopes of settlement in Libya,
but they remain high and technicals suggested Brent <LCOc1>
could soon be heading towards $130 a barrel.
The ECB raised benchmark rates by 25 basis points last week
to 1.25 percent, the first hike since 2008, and used language
suggesting that another rise is in the pipeline.
U.S. Federal Reserve officials, in the meantime, have been
making more hawkish comments, calling into question the future
of its asset-buying quantitative easing programme.
"This week, perhaps, the focus could be on whether the
Federal Reserve actually indicates to the market whether they
will be exiting their loose monetary policy, and whether they
display any hawkish signals," said Ong Yi Ling, investment
analyst at Phillip Futures in Singapore.
One result of the mood was to send core euro zone debt
yields higher, with Bund yields <DE10YT=TWEB> above 3.5 percent
from the first time since August 2009.
The euro zone periphery was in focus a German magazine
reported on Saturday some euro zone finance ministers told the
ECB they have doubts Greece will meet its fiscal targets and
suggested it restructure its debt. []
The euro touched its highest against the yen since May 2010
of 123.33 yen <EURJPY=R> on trading platform EBS. It later gave
up some of those gains and was last down 0.15 percent at 122.56
yen.
It was down 0.1 percent to $1.4465 <EUR=>, having hit a
15-month high of $1.4489 on Friday.
HIGHER COMMODITIES
On commodity markets, copper prices inched higher, tin hit a
record for a second straight session and lead scaled a
three-year high on the London Metal Exchange.
Gold jumped to a lifetime high for a fifth session, topping
$1,476 an ounce.
World stocks as measured by SCI <>MIWD00000PUS> were flat,
with emerging markets <.MSCIEF> off 0.2 percent.
European stocks fell as caution built before the next round
of corporate earnings reports. The FTSEurofirst 300 <>
index of top European shares was down around a third of a
percent.
"Investors seem too complacent at the moment, ahead of the
earnings season," said Frederic Buzare, global head of equity
management at Dexia Asset Management. "I'm cautious on the short
term for stocks."
(Additional reporting by Saikat Chatterjee, Blaise Robinson
and Anirban Nag; Editing by John Stonestreet)
