GLOBAL MARKETS-World stocks inch higher ahead of U.S. inflation data

* Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

* Eyes on U.S. CPI data due at 1230 GMT

* Stocks inch higher

* Yen falls on Abe scandal

* Oil prices fall

* Slovak bond yields rise on politics

LONDON, March 13 (Reuters) - World shares inched higher on Tuesday, eking out limited gains as investors kept a wary eye on a U.S. inflation reading later in the day that could offer clues on the pace of Federal Reserve interest rate hikes this year.

The MSCI All-Country World index of stocks, which tracks shares in 47 countries was up less than 0.1 percent by 1149 GMT.

The index has recovered about half its losses during a shakeout in stocks in February. The selloff came on the back of strong U.S. wage numbers, which investors feared might feed into inflation and push the U.S. central bank towards a faster pace of monetary tightening.

Raising its global growth forecasts, the Organisation for Economic Cooperation and Development (OECD) said the Fed would probably have to raise interest rates four times this year as inflation picks up.

U.S. consumer price index (CPI) data is due at 1230 GMT.

"Today's CPI inflation data is likely to add further colour to the U.S. inflation picture, however it probably wont add any further clarity to the overall inflation outlook puzzle, given that the Fed doesnt use CPI as its inflation benchmark," said Michael Hewson, chief markets analyst at CMC Markets in London.

"Nonetheless it is still a useful gauge in establishing when and how the price pressures weve been seeing build up in U.S. supply chains start to filter down into the wider economy."

While the consumer price index is a popular barometer of economic health, it is not the primary gauge the Fed uses to measure inflation. Instead, the Fed uses the personal consumption expenditures (PCE) index.

The pan-European STOXX 600 fell 0.1 percent, trimming earlier gains.

Earlier in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 percent after spending much of the day swerving in and out of negative territory.

The index surged 1.5 percent on Monday following firm U.S. jobs numbers on Friday, while low wage growth eased concerns about inflation and faster central bank rate hikes.

But a mixed performance by U.S. shares overnight tempered the rally.

The S&P 500 and the Dow slipped on Monday as the U.S. tariffs signed into law last week weighed on industrials, while a rise in tech stocks boosted the Nasdaq to a new record high. Wall Street was set to open higher on Tuesday


In currencies, the Japanese yen fell over half a percent to a two-week low against the dollar, pressured by a political scandal engulfing Japanese Prime Minister Shinzo Abe's government. It also lost ground to the euro.

The yen tends to suffer in an environment when riskier and higher-yielding assets are bid but Morgan Stanley strategists said in a note that a further deterioration in the political situation that affected the position of Abe, could see the yen "forcefully return towards its previous upward trend."

The dollar index, which measures the greenback against a basket of currencies, was up 0.1 percent.

"The broader story remains that of U.S. monetary policy normalization in the backdrop of an improving economy and a further decline in currency market volatility would only fuel more risk taking appetite," said Commerzbank's FX strategist Thu Lan Nguyen.

Slovakia's 10-year bond yield rose as much as five basis points and the cost of insuring exposure to its debt hit the highest in almost three months as the government inched towards collapse.

The benchmark 10-year U.S. Treasury note yield stood little changed at 2.879 percent.

U.S. crude futures were down 0.2 percent to $61.27 per barrel. Brent also fell 0.3 percent to $64.77 per barrel.

Spot gold fell 0.3 percent to $1,318.78 per ounce.

(Reporting by Ritvik Carvalho; additional reporting by Saikat Chatterjee in LONDON and Asia markets team; Editing by Janet Lawrence )