SINGAPORE, July 17 (Reuters) - Gold hit a record and

bonds rallied on Wednesday as markets prepared for global

interest rates to fall, while stocks in Taiwan slipped after

U.S. presidential candidate Donald Trump sounded lukewarm in his

commitment to the island's defence.

The S&P 500 scaled record highs overnight and futures

were steady in Asia. MSCI's broadest index of

Asia-Pacific shares outside Japan was flat and

Japan's Nikkei rose 0.1%.

In Taiwan, chipmaker TSMC fell 2%, wiping out

almost $16 billion in market value, after Trump questioned U.S.

support in an interview with Bloomberg Businessweek, saying

Taiwan should pay for U.S. protection.

It was unclear exactly what Trump was planning, however his

selection of trade hawk J.D. Vance as his running mate had

already put markets on notice that China will figure heavily in

his foreign policy thinking.

Chinese stocks were subdued for a second day running.

The Taiwan dollar slipped slightly to a two-week

low. China's yuan steadied at 7.2676 per dollar.

"It is more and more clear to me that Trump should be

bullish USD for at least a while," said Brent Donnelly,

president at analytics firm Spectra Markets, as he's expected to

impose tariffs and run a higher budget deficit.

"It's hard to imagine USDCNH ending 2024 below 7.25 on a

Trump victory in November but it's not hard to imagine it

closing above 7.50," he said, referring to the dollar-yuan pair.

Elsewhere in Asia, New Zealand shares hit their

highest since March 2022 after data showed inflation slowing,

though the rates market dipped and the currency rose on

sticky domestically driven inflation.

Treasuries held gains that had pushed 10-year U.S. yields to

four-month lows overnight after Federal Reserve Chair Jerome

Powell said recent cooling in inflation readings "add somewhat

to confidence" that consumer prices are coming under control.

Fed funds futures have fully priced a U.S. rate cut

for September, followed by two more before the end of January

2025.

Ten-year yields were steady at 4.175% and

two-year yields hovered at 4.445%. Bond markets in

Australia, Japan and South Korea rallied.

Lower yields helped propel gold sharply higher

overnight and through chart resistance around $2,450 per ounce

despite a broadly firm dollar. It touched a record $2,478 in

Asia trade on Wednesday.

"Gold's ability to find support in any condition this year

is worth highlighting," said Commonwealth Bank of Australia

commodity strategist Vivek Dhar.

"While we think gold prices face uncertainty in coming

months, we think the uncertainty has a positive skew, raising

the risk that gold rises above our forecast of $2,500/oz by the

end of the year."

The Japanese yen was slightly weaker at 158.51 per

dollar, though after a few rounds of suspected yen buying from

Japanese authorities last week it remained well off a 38-year

low of 161.96 touched earlier in July.

The euro was steady at $1.0925. Oil prices slipped

slightly, weighed by signs of weakening demand from China.

Brent crude futures fell 13 cents to $83.60 a barrel

and U.S. crude futures were also 13 cents lower at $80.63

a barrel.

British inflation data is due later in the day where focus

will fall on services inflation, which is expected to run at a

still-hot 5.6% in June from a year earlier.

(Editing by Sam Holmes)