China shares pause for GDP test, euro pressured

SYDNEY (Reuters) - Chinese shares fought to sustain yet another seven-year peak on Tuesday a day before the country updates on economic growth, while much of the rest of Asia took a breather after recent hefty gains.

A surprise decision by Singapore's central bank not to ease policy gave a boost to emerging currencies in the region, while the euro touched lows on the yen not seen since mid-2013.

China's central bank continued to slowly relax its policy by guiding short-term money market rates lower for the fifth time since the Lunar New Year in February.

The Asian giant reports gross domestic product for the first quarter on Wednesday and there are risks it could disappoint after poor trade news this week.

Caution set in after an early jump and Shanghai stocks <.SSEC> faded 0.2 percent, having climbed almost uninterrupted for more than five weeks now. Hong Kong's main index <.HSI>, which touched a seven-year high on Monday and rose 12 percent in the past five sessions, dipped 1 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> eased 0.3 percent to 512, shying away from September's top of 516. A break there would take it to ground last trod in early 2008.

Likewise, Japan's Nikkei <.N225> dithered around 19,900, having struggled to sustain a break above the 20,000 barrier.

On Wall Street, investors had fretted that a strong dollar would constrain earnings at multinational corporations. The Dow <.DJI> ended Monday down 0.45 percent, while the S&P 500 <.SPX> dropped 0.46 percent and the Nasdaq <.IXIC> 0.15 percent.

Estimates for first-quarter S&P 500 results have fallen sharply since Jan. 1, with earnings for the period expected to have declined 2.9 percent from a year ago, Thomson Reuters data showed.

Eyes are also on U.S. retail sales data due later Tuesday for evidence that spending is picking up after a sluggish start to the year.

An upbeat result would add to the case for rate hikes from the Federal Reserve later this year, and support the dollar.

The yen made gains of its own after Koichi Hamada, an economic adviser to Japan's Prime Minister Shinzo Abe, indicated the yen was excessively weak against the dollar.

The euro led the way lower with a drop to 126.35 yen , depths not visited since June 2013 and the sixth straight session of losses. The dollar decline was mild in contrast as it drifted off to 119.83 yen , from an early 120.10.

The euro also eased to $1.0543, from an early rise to $1.0570, having fallen as low as $1.0519 on Monday. Against a basket of major currencies, the dollar was up 0.1 percent at 99.637 <.DXY> and not far from recent peaks.

In commodities, oil prices rose after the U.S. Energy Information Administration said it expected U.S. shale oil output to record its first monthly decline in over four years.

U.S. crude gained 44 cents to $52.35, while Brent May crude added 51 cents to $58.44.

(Editing by Richard Borsuk & Shri Navaratnam)