* Asia stocks drift as govts warn of economic uncertainty
* Sterling slumps to 13-year low against Aussie dollar
* China output misses forecasts but recovery seen intact
* Dollar, yen firm in reaction to Chinese data
By Susan Fenton
HONG KONG, Aug 11 (Reuters) - Most Asia stock markets
drifted lower on Tuesday as policymakers warned of lingering
economic uncertainty and data showed China's recovery may be
moderating, while sterling hit a 13-year low against the Aussie
dollar.
Many Asian investors are pinning their hopes on China
leading a regional recovery as Western economies continue to
sputter, but Chinese data for July showed that although exports
rose from June, industrial output did not grow as much as
expected [].
"This data argues for some moderation in growth in Q3
versus the big gains we saw in Q2. The recovery is still on
track, at least at the headline level," said Ben Simpfendorfer,
an RBS China economist in Hong Kong.
Shares in Hong Kong and Shanghai were down nearly 1 percent
after the Chinese data. Elsewhere equity markets were mostly
flat as South Korea, Japan and Singapore all indicated that the
economic outlook was uncertain despite some signs of
improvement.
Seoul's KOSPI index <.KSII> was up 0.3 percent, showing
little reaction to the central bank's decision to keep interest
rates on hold as expected. Recent signs of an upswing in the
economy have raised expectations South Korea will be one of the
first Asian economies to raise interested rates, but the
government stressed on Tuesday that domestic demand remained
weak.
"It will be difficult for the South Korean or other Asian
central banks to raise interest rates before the Fed moves,"
said Seo Chul-Su, an economist at Daewoo Securities in Seoul.
"Asian countries are still heavily dependent on the global
economy."
Singapore's stock market was the best performer in the
region as it rose 1.3 percent, catching up after a public
holiday on Monday. The government sprung a surprise by
upgrading its final second-quarter GDP growth but it warned
that economic recovery would be neither "quick nor strong"
[].
Japan's Nikkei index <> was up 0.2 percent after
hitting a 10-month closing high on Monday. The Bank of Japan
said the economy had stopped worsening but was still in a
difficult situation, and kept interest rates on hold at 0.1
percent. []
A firmer yen put pressure on shares of Japanese exporters,
including car giant Honda Motor <7267.T>, which was down 1.9
percent, but Toshiba Corp <6502.T> edged up 0.4 percent after
the company said it would join the Blu-ray Disc Association to
make blu-ray players by the end of the year [].
The MSCI Index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS>, which has rallied nearly 80 percent since a
global rebound in equities began on March 9, was down 0.6
percent. Wall Street gave little trading incentive as the Dow
<> dipped 0.3 percent after a four-week rally.
EXPORTERS HURT
In currency markets, sterling <GBP=> fell to a 13-year low
against the Australian dollar <AUD=> at 50.9 UK pence, after
slumping in overseas trade as investors fretted about the Bank
of England's shock decision last week to expand quantative
easing and concern about deflationary pressures in the UK
economy.
The pound fell 1.3 percent on Monday to as low as $1.6429
<GBP=>. In early trade on Tuesday it was at $1.6466, having
shed almost 6 cents in three trading days.
The Australian dollar is also benefiting from the Reserve
Bank of Australia's shift last week to a neutral policy bias
from an easy policy stance and markets are pricing in a rate
hike before the end of the year.
However, the U.S. dollar and the Japanese yen <JPY=> gained
some ground against the Aussie and the New Zealand dollar
<NZD=> in reaction to the Chinese economic data.
The market has begun to price in tightening by the Federal
Reserve as early as February, a shift encouraged by last week's
encouraging jobs report. That has helped lift the dollar.
The greenback was at $1.4145 per euro <EUR=> against
$1.4143 late in New York, and at 97.00 yen <JPY=> from 97.08.
The BOJ statement had little impact on government bonds.
September 10-year Japanese government bonds <JP10YTN=JBTC>
edged higher after hitting a seven-week closing low on Monday,
tracking a rise in U.S. Treasuries.
