* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
LONDON, May 31 (Reuters) - World equities are set to post a
fourth consecutive month of gains on Monday, while the dollar
remains under pressure ahead of a slew of European and U.S. data
that will confirm whether the global economy is on a steady
MSCI's broadest index of world stocks
drifted 0.1% higher, putting the gauge on track for a 1.4% gain
for May. It is the longest monthly rising streak for the index
since August 2020, when the gauge rose for five consecutive
months, according to Refinitiv data.
But U.S. stock futures and European cash equities trading
were quiet on Monday due to holidays in the United States and
Britain, with benchmark indexes sticking to well-worn ranges.
May has proven to be a decent month for asset markets, but
policymakers are increasingly faced with the dilemma that
inflation is running above estimates while the underlying
structural economy is not improving as quickly.
The main event of the week will be U.S. payrolls on Friday
with median forecasts at 650,000 but the outcome is uncertain
following April's shockingly weak 266,000 gain. Although U.S.
inflation data last week was above estimates, another big miss
on the jobs front would heap pressure on the Fed to postpone
plans to wind down on stimulus.
"The question is, therefore, whether by September the
Federal Reserve will be in a position to announce a tapering of
its bond purchases starting next year, and the odds are quite
decent though it might be delayed to December," said Sebastien
Galy, a strategist at Societe Generale.
The Federal Reserve next meets on June 16 and this week will
be the last chance for members to discuss policy before the
blackout period starts on June 5.
So far, investors have taken the Fed at its word that the
labour market needs to improve a lot more before it speaks of
tapering. That helped yields on U.S. 10-year notes
ease to 1.58% with Fed funds futures pricing in a first rate
hike by the first quarter of 2023.
Elsewhere in equities, Asian shares edged higher and in
Europe, indexes consolidated gains after last week's record
close ahead of manufacturing PMI data this week.
A dovish Fed has also put the greenback under pressure
against its rivals with the dollar nursing losses at a
three-year low against the Chinese yuan.
The yuan was the big mover in global currency markets with
bulls pushing its value against a trade-weighted basket of
currencies to a five-year high and adding further pressure on
exporters in the world's second-biggest economy.
That spurred fresh verbal intervention by local policymakers
even as latest factory data showed China's factory activity
growth may have peaked for now.
Concerns about global inflation and slowing growth have
proved to be a boon for gold with prices for the yellow metal
rising 8% this month, vaulting comfortably above the $1,900
Oil prices were firm after gaining more than 5% last week to
reach two-year closing highs as expectations of a rebound in
global demand outweighed concerns about more supply from Iran
once sanctions are lifted.
All eyes will be on OPEC this week as it reviews its supply
agreement, and any hint of an increase in output could pressure
Brent added 38 cents to $69.10 a barrel, while U.S.
crude rose 39 cents to $66.71.
Usually volatile cryptocurrencies enjoyed a quiet start to
the week with bitcoin steadying around $36,000 while
its smaller rival Ethereum rose nearly 4% to $2,481.
(Reporting by Saikat Chatterjee; Additional reporting by Wayne
Cole in SYDNEY and Danilo Masoni in MILAN; Editing by Jacqueline