* Solid global economy underpins world shares
* Lack of Trump policy details undermine dollar
* Yuan flat after Trump calls China “grand champions” of FX manipulation
* European stocks seen down slightly
By Hideyuki Sano
TOKYO, Feb 24 (Reuters) - Asian shares took a breather on Friday, slipping from 1-1/2-year highs as material shares were hit by sudden falls in copper and other commodity prices while investors assessed Washington’s stance on tax and currency policies.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.5 percent, giving back part of this week’s gains, though it is likely to log its fifth straight weekly advance.
Material and resource shares were the biggest drag as they were spooked by big falls in the price of copper, iron ore and other commodities.
Hong Kong’s Hang Seng dropped 0.5 percent, as did Japan’s yen-sensitive Nikkei. China’s mainland shares were flat.
European shares are expected to be soft, with spread-betters looking to falls of up to 0.1 percent in major European indexes such as Germany’s DAX and Britain’s FTSE.
On Wall Street, the Dow managed to notch a record high for a tenth straight session, the longest sequence of record setting since 1987. It was also the longest streak of gains for the index since March 2013.
But U.S. retail stocks fell 1.0 percent, plunging late in the session. U.S. President Donald Trump spoke favourably about an export-boosting border adjustment tax being pushed by Republicans in the U.S. Congress, a measure strongly opposed by retailers.
Construction firms also fell 1.7 percent, which some attributed to speculation of delay in infrastructure spending.
Treasury Secretary Steven Mnuchin said on Thursday he saw limited impact from the new administration’s policies in 2017.
Since the U.S. election, traders have bet on tax cuts, less regulation and more infrastructure spending from Trump and the Republican-controlled Congress to bolster the U.S. economy.
“There are strong expectations on tax cuts in the U.S. markets. On the other hand, the chance of a Fed rate hike in March seems limited, which is also helping shares,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.
Mnuchin also laid out an ambitious schedule to enact tax relief for the middle class and businesses by August, but added the Trump administration was still studying a border tax.
As Trump has promised a “phenomenal” plan by early March to cut business taxes, many investors expect more clarity when he delivers a speech to Congress on Tuesday.
Wednesday’s Federal Reserve minutes, which showed that there was less urgency among voting members to raise interest rates, have helped to drive down U.S. Treasury yields and the dollar.
The yield on 10-year U.S. Treasuries hit a two-week low of 2.372 percent.
The dollar slipped to 112.55 yen, also a two-week low, on Thursday and last stood at 112.79 yen.
The euro fetched $1.0584, off Wednesday’s six-week low of $1.0494.
Trump also called China “grand champions” of currency manipulation in an interview with Reuters, doing little to raise confidence on trade relations between the world’s two biggest economies.
Markets appeared to take his comments in stride, as they were made just hours after his new Treasury secretary pledged a more methodical approach to analysing Beijing’s foreign exchange practices.
“It’s politics versus reality. The Treasury has highlighted very clearly and has a very longstanding policy of the framework and the three rationales for naming someone a currency manipulator,” said Josh Crabb, head of Asian equities at Old Mutual Global Investors in Hong Kong.
”At the end of the day Trump can say what he wants. This is not an economy where the President actually has that much power. He’s subject to the House and the Senate and also the Judiciary. There’s politics to be played. And the Chinese, they get this,” he added.
The offshore yuan stood little changed at 6.8535 per dollar . The yuan was emerging Asia’s worst performer last year, even as Beijing tried to stem its fall, sliding around 6.6 percent in its biggest drop in over 20 years onshore.
Other Asian currencies edged up against a broadly weak dollar, with the Korean won hitting a four-month high. .
Oil prices held gains on data showing U.S. stockpiles rose for a seventh straight week but at a pace that was well below expectations. News of oil being sold out of storage in Southeast Asia also supported the market.
U.S. West Texas Intermediate was unchanged at $54.41 a barrel. WTI was on track for a weekly gain of about 1.8 percent, which would be its biggest so far this year.
Brent crude was also little moved at $56.57 and was on track for a weekly gain of about 1.2 percent. (Additional reporting by Nichola Saminather in Singapore,; Editing by Jacqueline Wong and Simon Cameron-Moore)