* Strong Empire State and PPI figures help lift dollar
* World Bank sees stronger growth in 2014
* Aussie dollar slumps to 3-1/2 year low after jobs report
By Dominic Lau
TOKYO, Jan 16 (Reuters) - The dollar rose to a one-week high against the yen on Thursday, as robust U.S. data and upbeat earnings from Bank of America helped offset concerns of a U.S. slowdown following December's disappointing payroll numbers.
European shares were expected to open firmer, ahead of the euro zone inflation data, according to financial bookmakers, after scaling 5-1/2 year highs on Wednesday.
Australian shares led the charge higher in Asia, with a gain of 1.2 percent, while MSCI Asia-Pacific ex-Japan Index added 0.1 percent.
"Firm data are pointing to improvement in the U.S. economy, assuring that its strength will guide emerging markets higher," said Ko Seung-hee, a market analyst at SK Securities.
U.S. producer prices posted their biggest gain in six months in December as the cost of gasoline rebounded strongly, but inflation pressure remained generally benign.
Separately, the Federal Reserve Bank of New York said the Empire State gauge of manufacturing in New York state jumped to its highest level in 20 months in January as new orders soared.
Japan's Nikkei erased early gains to end down 0.4 percent, however. The benchmark logged its best one-day rise in four months on Wednesday, a day after suffering its worst session in five months.
Overnight, U.S. stocks gained, with the Standard & Poor's 500 climbing to an all-time closing high on the back of the economic data and strong quarterly earnings from Bank of America.
The second-largest U.S. bank said quarterly profit surged nearly $3 billion as revenue increased and mortgage losses plunged in the clearest sign yet the bank was shaking off the impact of the financial crisis.
"The news from Bank of America's fourth-quarter numbers suggest the U.S. earnings season is in for a solid beat," Evan Lucas, market strategist at financial spreadbetter IG in Melbourne, wrote in a note.
Other U.S. banks have also done well so far in this quarterly earnings season, with JPMorgan Chase & Co and Wells Fargo & Co both reporting better-than-expected results this week.
Citigroup and Goldman Sachs are to report later in the day, followed by Morgan Stanley on Friday. Bellwether General Electric will also unveil results on Friday.
Adding to the positive tone, the World Bank raised its forecast for global growth for the first time in three years as advanced economies started to pick up their pace, led by the United States.
The World Bank predicted global gross domestic product will expand 3.2 percent this year from 2.4 percent in 2013.
Buoyed by the upbeat data, the dollar regained some of its swagger after being battered by the surprisingly weak nonfarm payroll report.
It gained 0.2 percent to 104.735 yen, adding to a 0.3 percent rise overnight and a far cry from a four-week low of 102.85 set on Monday.
In Japan, core machinery orders jumped in November for the second straight month of gains, a sign companies may be ready to ramp up investment and increase wages.
Against the euro, the greenback was down a tad at $1.3618 , having gained 0.3 percent overnight.
"We remain bullish on the USD and see scope for further downside in EUR/USD and GBP/USD in the near-term," BNP Paribas analysts wrote in a note.
The dollar was a touch softer against a basket of major currencies at 80.971, after rallying 0.4 percent on Wednesday.
The Aussie dollar fell to a 3-1/2 year low of $0.8797 after a weak jobs report cast doubt on market perceptions that the Reserve Bank of Australia was done cutting rates.
Among commodities, gold edged up 0.1 percent at $1,241.89 an ounce, steadying after having hit a near one-week low of $1,234.10 on Wednesday as the dollar rallied.
U.S. crude futures were largely steady at $94.22 a barrel, not far from a two-week high of $94.64 set in the previous day after U.S. government data showed a larger-than-expected drop in inventories.