(Updates prices following China market open)

*

Worries about global growth trigger losses for oil, Wall

Street

*

Beijing keeps 5% growth target unchanged, lines up more

stimulus

*

Euro pushes to four-month peak on German spending boost

By Kevin Buckland

TOKYO, March 5 (Reuters) - The U.S. dollar hovered near

a three-month low versus major peers on Wednesday after the

latest round of U.S. tariffs and countermeasures from Canada and

China stoked fears of an escalating trade war.

Hong Kong stocks rose but the yuan retraced part of

Tuesday's advance as annual parliamentary sessions of the

National People's Congress (NPC) kicked off with Beijing

retaining a roughly 5% economic growth goal for 2025.

The euro pushed to a nearly four-month peak after German

political parties agreed to a 500-billion-euro infrastructure

fund. Sterling also stood tall near a three-month high.

Crude oil swooned to six-month lows, while bitcoin

found its feet around $87,500 following a volatile week.

"Fears about weaker U.S. and global economic activity are

manifesting in the markets, with cyclicals driving the

sell-off," said Kyle Rodda, senior financial markets analyst at

Capital.com.

"The uncertainty is enough to keep investors cautious, with

American businesses and consumers presumably feeling the same."

Australian stocks slumped 1.1%, while Japan's Nikkei

was flat after flipping between small gains and losses.

Hong Kong's Hang Seng rallied 1.1%, although mainland

Chinese bourses were mixed, with an index of blue chips

little changed.

China's offshore yuan edged down about 0.3% to 7.2716 per

dollar, after strengthening 0.7% on Tuesday.

Along with an unchanged economic growth target, Beijing

committed more fiscal resources than last year to mitigate the

impact of rising U.S. tariffs.

China aims for a budget deficit of around 4% of gross

domestic product (GDP) in 2025, up from 3% in 2024.

"Growth, inflation and fiscal spend targets were all pretty

much as expected," said Charu Chanana, chief investment

strategist at Saxo.

"It doesn't look like China wants to go overboard with

spending right away given the tariff threats, as they

potentially want to save ammunition for external threats later

in the year."

Overnight, the U.S. S&P 500 slid 1.2%, but futures

rose 0.5% on Wednesday.

MSCI's world equity index was flat, leaving

it 1.9% lower so far this week.

U.S. President Donald Trump's 25% tariffs on imports from

Mexico and Canada, along with doubled duties of 20% on Chinese

goods, took effect on Tuesday. China and Canada retaliated while

Mexican President Claudia Sheinbaum vowed to respond likewise,

without giving details.

The U.S. dollar index, which measures the currency

against the euro, sterling and four other major counterparts,

was little changed at 105.60, after a two-day 1.9% slump that

took it as low as 105.49 for the first time since December 6.

The euro rose as high as $1.0637 for the first

time since November 13 in the latest session.

Sterling was steady at $1.2786, not far from

Tuesday's peak of $1.27995, a level last seen on December 6.

The parties hoping to form Germany's next government on

Tuesday agreed to create a 500 billion euro infrastructure fund

and overhaul borrowing rules in a tectonic spending shift to

revamp the military and revive growth in Europe's largest

economy.

Oil fell for a third session on Wednesday amid concerns over

global growth due to tit-for-tat tariffs and plans by OPEC+ to

raise output in April.

Brent futures eased 15 cents to $70.89 a barrel,

after falling as low as $69.75 in the previous session, its

lowest since September 11.

U.S. West Texas Intermediate (WTI) crude fell 40

cents a barrel to $67.86 after dipping as low as $66.77 in the

previous session for the first time since November 18.