By Nigel Stephenson
LONDON (Reuters) - Shares rose in Europe and Asia on Tuesday while sterling fell to its weakest in a month against the dollar on the prospect of easier monetary policy in Britain following its June vote to leave the European Union.
The Bank of England's sole policy hawk, Ian McCafferty, told The Times newspaper that, if the UK economy slowed as much as sentiment surveys have suggested, more easing would be required on top of the measures unveiled by the Bank last week.
That was enough to push sterling as low as $1.2968, its weakest since July 11.
But the picture was complicated by data showing the biggest rise in retail spending in Britain in six months in July.
"McCafferty really underlined the dovishness of the MPC last week," said Jane Foley, a strategist with Rabobank in London. "But (reading the BRC data) consumers do seem to have been more robust than many had anticipated."
The BoE last week cut interest rates for the first time since 2009 to cushion the economic shock of the Brexit vote, and Australia also cut its rates to a record low last week. New Zealand is widely expected to cut on Thursday.
Britain's blue-chip share index rose 0.24 percent, in line with a 0.23 percent rise in the pan-European STOXX 600 index, led higher by banks and autos.
Earlier, Asian shares hit one-year highs as a global search for yield drove a record inflow into emerging market funds.
Analysts at Bank of America Merrill Lynch said last week the search had led to the largest five-week inflow on record to emerging market debt funds and the longest inflow streak to equity funds in two years.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.2 percent, having already risen for three sessions in a row.
Japan's Nikkei closed 0.7 percent high, rising for the fourth straight session.
Chinese shares rose 0.5 percent after July inflation data kept alive the prospect of easier monetary policy. Consumer price slowed compared with June while a long decline in producer prices moderated.
The dollar rose marginally against a basket of major currencies, still benefiting from slightly raised chances of higher Federal Reserve interest rates this year after Friday's stronger-than-expected U.S. jobs data.
The yen edged up 0.1 percent to 102.35 per dollar while the euro slipped 0.1 percent to $1.1084.
Oil prices fell as the market focused on a persistent supply glut, partially unwinding Monday's 3 percent gains chalked up on the prospect of a meeting of oil producers.
Brent, the international benchmark, fell 20 cents to $45.19 a barrel.
(Additional reporting by Wayne Cole in Sydney and Patrick Graham in London; editing by John Stonestreet)
