* MSCI Asia ex-Japan steady, Nikkei hits fresh 4-1/2-year
* Dollar near 3-1/2-year high against yen after solid jobs
* Mixed China data curb demand for riskier assets
* European shares likely inch up
By Chikako Mogi
TOKYO, March 11 (Reuters) - The dollar held near multi-year
highs against the yen on Monday after surprisingly strong U.S.
labour data, but demand for riskier assets was curbed by a mixed
bag of Chinese data which pointed to a patchy recovery in the
world's second-largest economy.
Commodities prices were caught between growing optimism
about more solid demand as the global economy improves and the
strengthening dollar, which makes dollar-denominated commodities
more expensive for non-dollar holders.
European markets were seen edging higher, with financial
spreadbetters predicting London's FTSE 100, Paris's
CAC-40 and Frankfurt's DAX would open up about
U.S. stock futures were little changed, pointing to a
steady Wall Street start.
The MSCI's broadest index of Asia-Pacific shares outside
Japan held steady but was weighed down by a 0.1
percent drop each in South Korean shares and Shanghai
Chinese economic indicators released over the weekend
signalled a looming dilemma for policymakers, as inflation stood
at a 10-month high in February while factory output and consumer
spending were weaker than forecast.
"China's macro picture is getting better but there's still a
lot of uncertainty, especially on the details of the public
policy to be released this week," said analyst Bonnie Liu of
Macquarie in Shanghai.
Australian shares rose 0.5 percent, hitting a fresh
4-1/2 year high led by financials after the Dow Jones industrial
average posted its fourth consecutive record high close
on Friday, but weaker metal prices hit mining companies. The
commodity-linked Australian dollar eased 0.1 percent to
In Seoul, investors were jittery amid intensifying tensions
with North Korea and as further weakness in the yen threatens
South Korean exporters.
The yen's slide bolstered Japanese equities, with the Nikkei
stock average closing up 0.5 percent after hitting a
fresh 4-1/2-year high.
FUNDAMENTALS BOOST DOLLAR
U.S. nonfarm payrolls jumped by 236,000 jobs last month,
above forecast for a 160,000 gain, while the unemployment rate
fell to a four-year low of 7.7 percent from 7.9 percent.
The data was unlikely to prompt the Federal Reserve to
change its policy settings anytime soon as the U.S. central bank
has said it will keep its near-zero rate stance until the
unemployment rate falls to 6.5 percent, as long as inflation
does not threaten to top 2.5 percent.
But brighter growth prospects underpinned the dollar.
"As both Europe and Japan look to continue with easy
monetary policy, improving economic indicators in the United
States make it likely that the U.S. would be the first to depart
from global accommodative conditions, putting upward pressures
on yields and supporting the dollar," a senior official at a
Japanese institutional investor said.
"It's too early yet to say the current dollar buying based
on solid U.S. fundamentals is sustainable. Effects from U.S.
spending cuts may start to weigh on growth later on and
undermine the dollar," he said.
The dollar was up 0.1 percent against the yen at 96.06
, near Friday's peak of 96.60 yen, its highest since
August 2009. The euro was trading up 0.2 percent at
124.98 yen, off a high of 125.98 yen touched on Friday.
"Much of the recent move in the U.S. dollar is a reflection
of more fundamental money flows out of the yen and out of the
euro concurrently, and that is enough of an effect -- a truly
massive effect -- to nudge the dollar higher," said Richard
Hastings, macro strategist at Global Hunter Securities.
"This is of course a big change from forex conditions years
Currency speculators boosted their bets in favour of the
U.S. dollar in the latest week to the highest in over seven
months, while also raising short positions in most other major
currencies, such as the yen, the euro and sterling, data from
the Commodity Futures Trading Commission showed on Friday.
A report on data flows from EPFR Global sent mixed signals
about investors' risk appetite.
Money flowed out of funds tied to gold and cash, and equity
funds outgained bond funds overall, while alternative funds and
high yield bond funds saw strong inflows. But emerging market
equity and bond funds struggled.
U.S. crude was down 0.2 percent at $91.74 a barrel
while Brent fell 0.3 percent to $110.47.
London copper inched up 0.1 percent to $7,749.75 a
Spot gold edged up 0.2 percent to $1,581.16 an ounce,
off a two-week low hit after the U.S. jobs data, as the Fed was
seen retaining its monetary stimulus.