*

Japan's yen strengthens to almost five-week high vs dollar

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US PCE data roughly in line with expectations

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Oil choppy after Israel-Hezbollah ceasefire, before OPEC+

meet

(Updates to late U.S. morning)

By Sinéad Carew and Medha Singh

Nov 27 (Reuters) - MSCI's global equities index edged

lower and the dollar slipped on Wednesday as investors digested

the latest economic data and the potential impact of policies

from the incoming U.S. administration, including threats of new

tariffs.

U.S. Treasury yields pared some declines in choppy trading

after data showed U.S. consumer spending increased solidly in

October, suggesting the economy kept a strong growth pace last

month but that progress dampening inflation has stalled.

Oil prices flitted between red and green after a ceasefire

deal between Israel and Hezbollah in Lebanon while also

anticipating Sunday's OPEC+ meeting, which may delay a planned

increase in oil output.

Equities lost some ground as investors read through the

data, which showed that in the 12 months through October core

inflation, which the U.S. central bank tracks for monetary

policy, increased 2.8% after climbing 2.7% in September.

"This was no earth-shattering news for the markets. We all

expected that inflation would pop up a little bit, but inflation

is not getting out of hand. And that's the key." said Peter

Cardillo, chief market economist at Spartan Capital Securities.

"This paves the way for a 25 basis point cut in December and

then probably a pause."

Traders are betting on a 70% probability for a Federal

Reserve rate cut in December compared with a 59% probability on

Tuesday, according to CME Group's FedWatch tool.

On Wall Street at 11:37 a.m. (1637 GMT), the Dow Jones

Industrial Average was up 7.90 points, or 0.02%, to

44,868.21, the S&P 500 was down 20.96 points, or 0.35%,

to 6,000.67, and the Nasdaq Composite was down 170.34

points, or 0.89%, to 19,005.23.

MSCI's gauge of stocks across the globe was

down 0.48 points, or 0.06%, to 858.60, while Europe's STOXX 600

index was down 0.2%.

Cardillo expects a pause in rate cuts after December on

uncertainty about Trump's tariff threats.

Trump said late on Monday that he would immediately put a

25% tariff on all products from Mexico and Canada when he takes

office in January, and impose an additional 10% tariff on goods

from China. The threat drew warnings of retaliation.

The incoming president also chose trade lawyer Jamieson

Greer as his new U.S. trade representative, a veteran of his

first-term trade war against China.

Alex Atanasiu, portfolio manager at Glenmede Investment

Management, pointed to preparation for Trump's return to the

White House as a factor behind Wednesday's trading since small

cap and cyclical stocks were up "at the expense of megacap

tech."

And such moves were likely magnified due to lower liquidity

as investors turn their focus to the U.S. Thanksgiving holiday

on Thursday, according to Atanasiu. Thursday's market close will

be followed by a shorter trading day on Friday.

In Treasuries, the yield on benchmark U.S. 10-year notes

fell 6 basis points to 4.242%, from 4.302% late on

Tuesday while the 30-year bond yield fell 5.8 basis

points to 4.4223%.

The 2-year note yield, which typically moves in

step with interest rate expectations, fell 4.1 basis points to

4.213%, from 4.254% late on Tuesday.

In currencies, the dollar index, which measures the

greenback against a basket of currencies including the yen and

the euro, was down 0.8% to 105.98.

Against the Japanese yen, the dollar weakened 1.46%

to 150.86, putting the yen at its strongest level versus the

greenback in almost five weeks.

The euro was up 0.82% at $1.0572, while sterling

strengthened 0.88% to $1.2678.

The largest cryptocurrency, bitcoin, attempted to

find its feet after a four-day retreat from a record high of

$99,830. It was last up 5.13% at $96,356.00.

Oil prices had settled lower on Tuesday following

confirmation of the Israel-Hezbollah ceasefire after selling off

more sharply on Monday in anticipation of an agreement.

On Wednesday, U.S. crude was down 0.07% at $68.72 a

barrel, while Brent was down to $72.73 per barrel, 0.11%

lower on the day.

Gold rose 0.38% to $2,641.87 an ounce. U.S. gold

futures rose 0.76% to $2,641.30 an ounce.