Asian shares creep higher, dollar languishes before ECB

By Rocky Swift

TOKYO, June 5 (Reuters) - Shares in Asia crept higher and the U.S. dollar languished ahead of the European Central Bank offering its policy outlook for a tumultuous global economy.

The dollar slid in the previous session after weak U.S. jobs and services data, with more weighty employment data due on Friday. Damage to the U.S. economy is becoming more apparent from President Donald Trump's erratic tariff action, while bilateral deals remain unrealised.

Canada prepared possible reprisals against the imposition of new U.S. metals tariffs while the European Union reported progress in trade talks with Washington. Against that backdrop, market watchers considered the ECB almost certain to cut policy interest rates so will pay greater attention to what bank President Christine Lagarde signals about future decisions.

"There's uncertainty about the guidance the central bank will deliver given the murky outlook for U.S. trade policy and global growth," said Kyle Rodda, a senior financial market analyst at Capital.com. "A failure to deliver sufficiently dovish guidance could upset the equity markets as well as give the euro upward trend additional momentum."

Trump's doubling of tariffs on steel and aluminium imports became effective on Wednesday, hitting Canada and Mexico in particular. The same day, his administration sought "best offers" from trading partners to stop other import levies taking effect in July.

Japan is sending key trade negotiator Ryosei Akaza to the U.S. on Thursday for another round of talks. Germany's new chancellor, Friedrich Merz, is also due to head to Washington.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.7% in early trade, whereas Japan's Nikkei stock index .N225 slid 0.2%.

The dollar index =USD, which measures the greenback against a basket of currencies, was flat at 98.85 after a 0.5% slide on Wednesday.

The dollar rose 0.1% against the yen to 142.92 JPY=. The euro EUR= was flat at $1.1416 after a 0.4% gain in the trading previous session.

Gold pared gains from the previous day while oil slipped after a build in U.S. inventories and Saudi Arabia's cut to its July prices for Asian crude buyers.

Spot gold XAU= edged 0.1% lower to $3,372.7 per ounce. U.S. crude CLc1 dipped 0.2% to $62.75 a barrel.

The pan-region Euro Stoxx 50 futures STXEc1 were little changed while U.S. stock futures, the S&P 500 e-minis ESc1, were down 0.1%.

(Reporting by Rocky Swift; Editing by Christopher Cushing)