*

Stocks meander ahead of Fed policy decision

*

Investor await trade deals between US and partners

*

Asian FX in the spotlight after Taiwan dollar's surge

By Ankur Banerjee

SINGAPORE, May 6 (Reuters) - Global stocks held tight

ranges on Tuesday and the dollar clawed back some of its recent

losses against Asian counterparts as investors revived concerns

about U.S. tariffs and their impact on economic growth.

Those worries coupled with pledges from key oil producers to

boost supply also kept crude prices languishing near four-year

lows.

The focus in Asia has shifted to currencies following the

Taiwan dollar's surge in recent sessions, which has

stoked speculation that a revaluation of regional foreign

exchange was on the cards to win U.S. trade concessions.

Its rally suggested a big unwinding is under way and shines

a light on one economy among many where years of big trade

surpluses have built up large long dollar positions at exporters

and insurers that are now under question and on edge.

The heat turned to Hong Kong on Tuesday, where the de facto

central bank bought $7.8 billion to stop the local currency from

strengthening and breaking its peg to the greenback.

"The real action today is in Asian FX," said Charu Chanana,

chief investment strategist at Saxo in Singapore.

"If these currencies keep strengthening sharply, it could

spark fears of a 'reverse Asian currency crisis', with potential

ripple effects in the bond market amid fears that Asian

institutions reassess their unhedged exposure to Treasury

holdings."

On the mainland, China's yuan strengthened to its

highest level since March 20 at 7.23 per dollar.

The Taiwan dollar was last at 30 per U.S. dollar in early

trading on Tuesday, not far from the near three-year high of

29.59 it touched on Monday as it jumped 8% over two days.

In stocks, MSCI's broadest index of Asia-Pacific shares

outside Japan was 0.2% lower with Japan closed

for a holiday. Taiwan stocks slipped 0.3%.

Chinese markets returned from a holiday with the blue-chip

index opening slightly higher. Hong Kong's Hang Seng

was down 0.2%.

Investor attention has been on the possibility of easing

trade tensions between the U.S. and China after Beijing last

week said it was evaluating an offer from Washington to hold

talks over tariffs.

But with few details, uncertainty has reigned with investors

left trying to make sense of headlines coming out of the White

House.

U.S. President Donald Trump said on Sunday that Washington

is meeting with many countries, including China, and that his

main priority with China is to secure a fair deal.

Trump also on Monday slapped a 100% tariff on movies

produced outside the United States but offered little clarity on

how the levies would be implemented.

Saxo's Chanana said tariff headlines are doing more to drive

market direction. "And that means the tactical risk-reward could

still be tilted to the upside with hard data holding up and

sentiment buoyed by hopes of trade deals."

Data on Monday showed the U.S. services sector's growth

picked up in April, while a measure of prices paid by businesses

for materials and services raced to the highest level in more

than two years, signaling a building up in inflation pressures

due to tariffs.

Attention shifts to the Federal Reserve's policy decision on

Wednesday, where the central bank is widely expected to keep

rates steady but the spotlight will be on how policymakers are

likely to navigate a tariff-ridden path.

"The markets want confirmation that the Fed intends to cut

rates through any price shock that tariffs cause, just as is

currently priced-in," said Kyle Rodda, senior financial markets

analyst at Capital.com.

Traders are pricing in 75 basis points of easing this year

with the first move possibly in July, LSEG data showed.

In commodities, oil steadied on Tuesday after hitting

four-year lows in the previous session that was driven by an

OPEC+ decision to accelerate output increases.

Gold prices touched a one-week high on safe-haven demand.

(Editing by Sam Holmes)