* MSCI Asia ex-Japan rises 1.5 pct, Nikkei jumps after sharp sell-off
* Markets respond to upbeat US data, but sentiment fragile ahead of Fed meeting
* Dollar stays volatile vs yen as position unwinding continues
* European shares likely track Asia higher
By Chikako Mogi
TOKYO, June 14 (Reuters) - Asian shares rebounded from multi-month lows on Friday, as upbeat U.S. economic data calmed frayed nerves after a bruising selloff in global markets, but investors remained anxious ahead of next week's Federal Reserve policy meeting.
European stocks look set to track Asia higher, with financial spreadbetters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX will open up as much as 0.8 percent. A 0.1 percent drop in U.S. stock futures hinted at a more shaky Wall Street start.
Volatility was still high in currency markets, with the dollar at one point losing more than 1 percent from early gains against the yen, and approached Thursday's four-month lows against a basket of six major currencies.
Wall Street rallied more than 1 percent on Thursday and the dollar pared losses on better-than-expected U.S. retail sales in May and a drop in the weekly jobless benefits claims, which signalled resilience despite fiscal tightening in America.
The better data appeared to bring some temporary relief to markets that have been rocked by uncertainty on whether the Fed would dial back its massive stimulus later this year. The U.S. central bank's huge bond-buying scheme has been the main source of rallies in broad risk assets.
Analysts expect markets to remain on edge ahead of the Fed meeting on June 18-19.
Some investors, such as holders of U.S. Treasuries, appear to have judged the Fed is close to paring back its $2.5 trillion, 4-1/2-year bond purchase program.
"Sentiment has improved following forecast-beating economic data from the U.S., but caution still largely rules markets ahead of the FOMC's meeting next week," said Kim Soon-young, a market analyst at IBK Securities, of Seoul shares.
MSCI's broadest index of Asia-Pacific shares outside Japan advanced 1.5 percent, but was set for a weekly decline of 1.4 percent. It tumbled more than 2 percent at one point to its lowest since September on Thursday and closed down 1.3 percent for its biggest daily drop in three weeks.
The dollar was down 0.4 percent at 94.98, off the session low of 94.43 but retreating from a high of 95.80 yen set in early Asian trading. The dollar fell to a 10-week low of 93.75 overnight, bringing it down about 8 percent from last month's 4-1/2-year peak of 103.74 yen.
The dollar index against a basket of six major currencies steadied just above a four-month low of 80.50 hit on Thursday.
"The Fed tapering speculation is keeping equities nervous and currencies will remain volatile until stability returns to equities," said Koji Fukaya, FPG Securities CEO in Tokyo.
"Because yen-short and dollar-long positions had been built to excessive levels, the reversal is deep. The yen selling was overdone and the latest market turbulence has taken much of that excess out," Fukaya said, adding that markets may view the dollar around 95 yen as a comfortable level for now.
Over the past three weeks global markets from stocks to emerging currencies were roiled by Fed Chairman Ben Bernanke hinting at the possibility of tapering the bond-buying stimulus if the economy continued to improve. The Chinese government's stance to hold off from taking additional steps despite a string of weak domestic data also heightened investor anxiety.
The World Bank this week cut its outlook for global growth, saying the economy should expand more slowly this year than last as it cited a deeper-than-expected recession in Europe and a recent slowdown in some emerging markets.
China's short-term funding costs jumped to their highest levels since January 2012, as a hardline stance by the central bank against injecting liquidity has forced the market to reverse expectations of monetary easing, traders said.
South Korean shares rose 0.3 percent after slumping to a seven-month closing low on Thursday on selling by foreign investors, while Australian shares rebounded 2.1 percent for their biggest one-day gain in 18 months after sinking to a 5-1/2-month low the previous day.
Hong Kong shares rose from an eight-month closing low the previous day, while Shanghai shares had a comparatively tepid recovery from six-month lows as money rates stayed tight.
Southeast Asian stocks also recovered, with the Philippine index rising 3 percent after suffering its biggest loss since October 2008 on Thursday as investors worried about a destabilising outflow of funds when the Fed reduces its liquidity injection.
In the strongest sign yet in regional emerging economies of the stress being wrought by the global markets rout, Indonesia on Thursday became the first central bank in Asia to raise its policy interest rate since 2011.
Two other central banks -- the Philippines and South Korea, however, decided to stand pat on Thursday.
In Japan, the stock market had another choppy session, extending a roller coaster ride in recent weeks, hurt by the stimulus worries and an underwhelming package of pro-growth measures unveiled by the government.
The benchmark Nikkei stock average closed up 1.9 percent after surging more than 3 percent earlier. The Nikkei lost 6.4 percent on Thursday, which wiped out the gains made since the Bank of Japan's big-bang stimulus unveiled on April 4, which had helped propel the index up to a 5-1/2-year high last month.
The BOJ's decision at its meeting earlier this week to skip fresh steps to calm domestic bond market turbulence and the Fed tapering jitters accelerated a wave of unwinding in heavily built short-yen and long-Nikkei positions - highly profitable bets until the latest tumult. Dwindling expectations for the government's economic policies also and fed to negative tone.
These adjustments were exacerbated as some hedge funds dumped assets for cash amid the global turmoil ahead of their half-year book closing, traders said.
As the unusual confluence of factors caused both the Nikkei and the dollar/yen to retreat to levels prior to the April 4 BOJ move, Japan's cabinet on Friday rubber-stamped a set of measures to boost economic growth, and Prime Minister Shinzo Abe promised to take more steps after next month's upper house elections.
U.S. crude futures eased 0.3 percent at $96.46 a barrel and Brent eased 0.3 percent at $104.60.
A sluggish dollar underpinned gold, which was up 0.1 percent at $1,386.06 an ounce.