* Wall St flat on 'fiscal cliff' stalemate
* Third-quarter U.S. GDP tops expectations; market barely reacts Ÿ
* Oil prices fall on future U.S. demand concerns
By Angela Moon
NEW YORK, Dec 20 (Reuters) - Global shares were little changed near 17-month highs on Thursday, while oil prices slipped as the latest setback in talks to avert the U.S. "fiscal cliff" kept buyers on hold.
In currency markets, the Bank of Japan's widely expected decision to ease policy for a third time in four months encouraged traders who had sold yen ahead of the move to take profits, sending the dollar and euro higher.
After gaining for most of the week, Wall Street was flat as investors fretted that a deal on the U.S. budget would not come as soon as they had hoped after President Barack Obama threatened to veto a controversial Republican plan.
The market barely reacted to strong U.S. economic data, including gross domestic product growth and housing, suggesting talks to avert the steep tax hikes and spending cuts due to take effect in 2013 remain the primary focus for markets.
Republican Speaker of the House John Boehner said Wednesday his chamber would pass a proposal that spares many wealthy Americans from tax hikes needed to balance the budget. Obama has threatened to veto the plan if it passes, while some Republicans oppose any deal featuring tax increases.
"The closer we get to the end of the year without a deal, the more optimism is going to evaporate," said Todd Schoenberger, managing partner at LandColt Capital in New York. "Volatility is going to be extreme until there's a deal, and the probability of being caught on the downside is much greater than being on the upside."
While investors have hoped for a budget agreement soon, this seems unlikely as wrangling continues over the details.
MSCI's world equity index has risen steadily over the past five weeks on optimism that a budget deal would clear the way for stronger growth in 2013. It was steady near 342 points on Thursday, not far from levels last seen in July 2011.
The Dow Jones industrial average was down 8.28 points, or 0.06 percent, at 13,243.69. The Standard & Poor's 500 Index was up 1.05 points, or 0.07 percent, at 1,436.86. The Nasdaq Composite Index was down 3.18 points, or 0.10 percent, at 3,041.18.
In Europe, equity indexes remained near multi-month highs. The pan-European FTSEurofirst 300 index, which closed near a 19-month high on Wednesday, edged up 0.04 percent to 1,142.68.
In the currency market, the euro pared gains against the dollar, hitting New York session lows in volatile trading, with no real fundamental driver for the move and thin market conditions tending to exacerbate moves.
The euro touched New York lows of $1.3232. It was last at $1.3239, up just 0.1 percent on the day. [ID: nL1E8NJLGQ]
The yen slipped against the dollar. The scale of asset purchases set by the Bank of Japan disappointed some investors who had positioned for more aggressive easing.
The benchmark 10-year U.S. Treasury note was up 7/32, the yield at 1.7805 percent.
The worries over the course of events in Washington spread through the commodity markets, stoking concerns about demand from the world's biggest consumer.
Brent crude slipped 25 cents to $110.11 a barrel and U.S. oil fell 23 cents to $89.75.
Gold edged back toward $1,670 an ounce, recovering from this week's 3-1/2 month low as physical buyers returned to the market. But the uncertainty over the U.S. fiscal crisis kept traders on the sidelines.