* Weak dollar lifts oil, metals; commodity stocks rise
* UK inflation jumps, sterling up on Brexit deal vote hint
* U.S. inflation due, dollar down as investors mull Fed outlook
By Nigel Stephenson
LONDON, Oct 18 (Reuters) - Rising commodity prices pulled shares higher and the dollar slipped from a seven-month peak on Tuesday, while sterling jumped on suggestions the UK parliament would have to ratify any deal for Britain to leave the European Union.
Wall Street looked set to follow European and Asian stocks markets higher, according to index futures .
U.S. inflation data due later will also be a focus after Federal Reserve Chair Janet Yellen suggested last week the central bank could allow inflation to top its 2 percent target.
The weaker dollar helped lift oil and metals prices, lifting commodity-related stocks in Europe and Asia.
The pan-European STOXX 600 share index rose 1.4 percent, led higher by a 2.9 percent rise in the basic resources sub-index and a 2.2 percent gain in banks.
Britain’s internationally-focused FTSE 100 index, in which miners are heavily represented, rose 1.2 percent.
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MSCI’s broadest index of Asia-Pacific shares outside Japan gained 1.4 percent, led by financials and energy shares. Australia’s benchmark index was up 0.4 percent while Japanese stocks edged higher on a softer yen.
Sterling hit a six-day high of $1.2272 before retreating, after data showing annual consumer price inflation in Britain accelerated to 1.0 percent last month from 0.6 percent in August, its biggest jump in two years.
It then jumped as far as $1.2304 after a British government lawyer said it was “very likely” the UK parliament would have to ratify the country’s eventual exit agreement with the EU.
Sterling last stood at $1.2260, still up 0.7 percent on the day. British government bond yields fell 3 basis points to just under 1.1 percent.
“It shows that political uncertainty is a more significant driver for the pound than the data. The market is short pounds and is coming off a string of hardline comments from the government -- this has provided some relief,” said Kamal Sharma, G10 strategist for Bank of America Merrill Lynch in London.
The inflation numbers confirmed that a weak pound since June’s Brexit vote is already pushing up some prices
Data due later is expected to show the U.S. core consumer price index held steady at 2.3 percent last month, according to economists polled by Reuters, above the Fed’s 2 percent target.
The dollar eased by 0.1 percent against a basket of currencies, pulling back further from a seven-month high hit on Monday, as investors digested recent comments from Yellen and other Fed officials.
On Monday Vice Chairman Stanley Fischer said economic stability could be threatened by low rates but it was “not that simple” for the Fed to hike.
HSBC currency strategist Dominic Bunning said: “It’s very hard for the dollar to maintain a bull run at the moment, because a stronger dollar acts as a tightening force on the U.S. economy ... so that makes it harder for the Fed to raise rates in December.”
The euro was flat at $1.0995 and the yen was down 0.1 percent at 104.00 per dollar.
The Australian dollar rose to as high as $0.7689 after central bank chief Philip Lowe said he was comfortable with the exchange rate and China’s yuan weakened marginally to about 6.74 per dollar, the latest in a series of six-year lows.
A decline in stockpiles as the northern hemisphere winter approaches was also behind oil’s push higher.
Brent, the international benchmark, rose 24 cents to $51.76 a barrel.
The weaker dollar also helped lift copper 0.4 percent to $4,694 per tonne before pulling back to $4,680. Gold prices also rose, gaining 0.4 percent to $1,260 an ounce. (Additional reporting by Saikat Chatterjee in Hong Kong, Jemima Jelly and Patrick Graham in London; Editing by Robin Pomeroy)