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GLOBAL MARKETS-Asian stocks ease, Singapore GDP impresses

Published 04/13/2011, 11:37 PM
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* Singapore has surprisingly strong Q1 growth

* Asian shares off lows; oil edges up

* U.S. dollar shaky after recent fall

SYDNEY, April 14 (Reuters) - Asian stocks slipped on Thursday as the market consolidated after a recent run-up to near three-year highs, although Singapore's impressive growth data underscored investor confidence in the region.

U.S. crude firmed slightly to $107.33 a barrel after data showed U.S. gasoline stockpiles plunged last week, and gold rose towards $1,460 an ounce as the U.S. dollar held near a 16-month low against a basket of major currencies.

In the first quarter, Singapore's gross domestic product grew 23.5 percent quarter-on-quarter on an seasonally-adjusted annualised basis, blowing past even the most bullish forecast in a Reuters poll.

Singapore's central bank allowed an immediate rise in the value of its currency dollar to help tackle inflation, which it said would likely stay elevated.

The Singapore dollar -- the world's 12th most actively traded currency -- rose to an all-time high of S$1.2452 per U.S. dollar before slipping back closer to S$1.25.

The upbeat Singapore growth news helped temper losses in Asian stocks. Japan's Nikkei fell 0.6 percent, having earlier lost as much as 0.9 percent, while stocks elsewhere in Asia shed 0.3 percent.

Just on Monday, MSCI's index of Asia Pacific stocks, excluding Japan, hit near three-year highs.

Australia's S&P/ASX 200 index was among the biggest losers, falling 0.7 percent on the day, led by a 12.5 percent plunge in contractor Leighton Holdings , which flagged a big year loss.

"We've had a fantastic run in the previous three weeks. We're easing back a bit now and that's probably the way we'll glide into Easter," said Austock Securities senior client adviser, Michael Heffernan.

U.S. DOLLAR STRUGGLES

By allowing its currency to rise, Singapore could encourage other Asian central banks to let their currencies appreciate further to contain imported inflation.

"The monetary policy is a little more aggressive than we expected, so I think it's a realisation that inflation is going to be a bigger problem in the months ahead," said Wai Ho Leong, economist at Barclays Capital.

"The recent crisis in Japan is probably adding to inflation pressure, rather than subtracting from growth in the near term."

Still, last month's devastating earthquake and tsunami in Japan's northeast saw Japanese corporate confidence plunge by a record amount in April, a Reuters survey showed.

The U.S. dollar, already under pressure, slipped further in the wake of Singapore's action.

The dollar index , which tracks its performance against a basket of major currencies, plumbed a session low at 74.891, nearing a 16-month trough of 74.704 set on Tuesday.

A mixed bag U.S. data, including a small rise in retail sales, did nothing to change the view that the Federal Reserve would stick to its super-easy monetary policy, which is a negative factor for dollar bulls.

Wall Street ended a choppy session little changed, although an upbeat outlook from network equipment maker Riverbed Technology inc helped the tech-heavy Nasdaq close 0.6 percent higher.

There was little market reaction to U.S. President Barack Obama's freshly announced goal of cutting the U.S. budget deficit by $4 trillion over 12 years through spending cuts and tax increases on the rich.

"The move to fiscal discipline is not likely to weigh materially on growth in 2011," BNP Paribas analysts wrote in a client note, adding it was unlikely to hit 2012 hard as well given it is an election year.

"But efforts to address the longer-term fiscal picture would indeed be encouraging." (Additional reporting by Miranda Maxwell in Melbourne; Editing by Richard Borsuk)

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