* MSCI Asia ex-Japan rises 1 pct, Nikkei cuts earlier gains
* Yen hits multi-year lows vs dollar, euro and Aussie
* BOJ helps keep global bond yields low
* Benign China inflation data soothes sentiment
By Chikako Mogi
TOKYO, April 9 (Reuters) - The yen fell to fresh multi-year lows and Japanese stocks touched near five-year highs on Tuesday as effects of the Bank of Japan's aggressive reflationary campaign reverberated through markets, while Asian equities rose on solid U.S. earnings.
European markets were likely to rise, with financial spreadbetters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX to open as much as 0.7 percent higher. U.S. stock futures were up 0.1 percent, suggesting a firm Wall Street open.
The BOJ's bold measures sent Japanese government bond yields down sharply across the curve, prompting a global drive in search of higher-yielding assets and pushing sovereign bond yields lower in the United States and the euro zone.
Some currency traders attributed the Thai baht's surge to a 16-year high against the dollar to investors borrowing yen cheaply to invest in higher-yielding assets in Thailand.
Benign Chinese inflation data also boosted sentiment as it kept hopes that an expansive monetary stimulus will stay in place to support the world's second-largest economy, but escalating tensions in the Korean peninsula took a toll on South Korean shares and its currency.
The MSCI's broadest index of Asia-Pacific shares outside Japan rose 1 percent, led by Australian shares which gained 1.4 percent on rises in blue chip financials and miners.
"It's hard to say which direction the market will go but I think near term the biggest catalysts will be the results from the U.S. earnings season," said Haris Khaliqi, research analyst at Foster Stockbroking.
Alcoa Inc, the largest U.S. aluminium producer, kicked off U.S. earnings on Monday, reporting an increase in quarterly profit on Monday and easing concerns about corporate results in the first three months of 2013.
South Korean markets were weighed by concerns over North Korea, with Seoul shares capped after a fall and the South Korean won < briefly dipping to a fresh 8-month low of 1,145.3 per dollar earlier.
North Korea suspended its sole remaining major project with the South on Monday, the Kaesong industrial park, amid speculation that it will take some sort of provocative action - another nuclear weapons test or missile launch.
China's annual consumer inflation eased to 2.1 percent in March from February's 3.2 percent while producer price deflation deepened, data showed on Tuesday.
"The lower inflation will greatly ease investors' concerns that policymakers would begin to tighten monetary conditions," said Haibin Zhu, chief China economist at JPMorgan Chase in Hong Kong.
The Australian dollar rose to a high of $1.0448 from around $1.0424, before drifting back. Australian assets are sensitive to economic indicators out of China, as it is Australia's largest export destination.
JAPAN STILL LEADS
The yen was expected to stay under pressure, while Japanese shares were seen garnering sustained support from the unprecedented scale of the stimulus unveiled late last week by the new BOJ Governor Haruhiko Kuroda.
Japan's Nikkei stock average index struck its highest since August 2008 in the morning, before profit taking wiped out most of the early gains.
David Baran, co-founder of Tokyo-based hedge fund Symphony Financial Partners, expected Japan's markets to perform in a similar way to U.S. markets after the the U.S. Federal Reserve first opted for quantitative easing four years ago with an asset buying programme. Both the Standard & Poor's Index and the Dow Jones industrial average have hit all-time highs during the last couple of weeks.
The Nikkei, currently at around 13,200, remains far below a lifetime high of 38,915.87 notched on Dec. 29, 1989.
Early in Asia on Tuesday, the dollar hit 99.67 yen , its highest since May 2009, while the euro climbed as far as 129.935 yen, its highest since January 2010.
The Aussie dollar soared to 103.81 yen, the highest since July 2008.
Traders expect the dollar to trade at 100 yen as soon as this week, as the reaction to the BOJ's strategy spreads.
"Markets are increasingly focused on the notion that larger JGB purchases, at longer maturities, by the BOJ could push Japanese domestic long-term investors elsewhere," said Vassili Serebriakov, strategist at BNP Paribas.
Firmer stocks underpinned risk appetite in Asian credit markets, tightening the spread on the iTraxx Asia ex-Japan investment-grade index by 3 basis points.
But gold suffered, as investors ignored tension between the two Koreas, and shifted funds to equities for better returns.
"I can say the chart point doesn't look good. The bond and stock markets are more interesting than gold," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
U.S. crude futures rose 0.4 percent to $93.75 a barrel and Brent rose 0.6 percent to $105.24.