*

Asian stocks drop, European futures point to lower open

*

Gold huddled near record high on safe haven flows

*

Fed's cautious tone provides dollar support

*

Investor focus turns to details of Trump's reciprocal

tariffs

(Updates ahead of European open, adds analyst comment in

paragraphs 11-12)

By Ankur Banerjee

SINGAPORE, March 21 (Reuters) - Asian stocks fell on

Friday in a downbeat end to the week as deepening geopolitical

worries and fears over U.S. tariffs and their impact on the

global economy curbed investors appetite for risk, keeping

safe-haven gold near record highs.

The sombre mood looked set to continue in Europe.

Pan-European STOXX 50 futures and Germany's DAX futures

fell 0.5%, while futures for the S&P 500 and

Nasdaq inched lower.

Policymakers across the globe struck a cautious note in a

week filled with central bank meetings as uncertainty in global

economics and politics grew. The U.S. Federal Reserve, the Bank

Of Japan and the Bank of England all held rates steady.

Central bankers highlighted the unsettled outlook due

largely to rising trade tensions triggered by the U.S under

President Donald Trump. Trump intends to impose new reciprocal

tariff rates on April 2, ushering in fresh wave of uncertainty.

Reports of Israeli airstrikes on Gaza and a huge blast from

a Ukrainian drone attack on a Russian military airfield were a

reminder of rising geopolitical tensions pushing investors

towards safe haven assets.

"With the bar for near-term rate cuts still high, markets

have shifted focus back to growth concerns and tariff risks

which will continue to fuel volatility," said Charu Chanana,

Saxo's chief investment strategist.

MSCI's broadest index of Asia-Pacific shares outside Japan

fell 0.9%, with stocks in China, Hong Kong,

Taiwan and Indonesia dropping sharply.

Hong Kong's Hang Seng index slid 2%, poised for its

second straight week in the red as investors turned cautious

following a surge in tech stocks and the index hitting a

three-year high on Tuesday. The Hang Seng is still up 18% for

the year, the best performing major stock market in the world.

Japan's Topix index touched an eight-month high led

by banking stocks as stronger-than-expected inflation data

fuelled expectations for further interest rate hikes by the Bank

of Japan.

Investors will now focus on the details of the Trump

administration's April 2 tariffs as markets become increasingly

nervous about the impact of tit-for-tat tariffs on inflation and

economic growth.

George Boubouras, head of research at K2 Asset Management,

said the unease was causing more market volatility.

"The sharp change in future expectations is effectively

leading to the amplified volatility events," he said.

The growing uncertainty and the Fed reiterating that it was

in no rush to cut rates lent support to the dollar. The dollar

index measure against a basket of six counterparts was

steady at 104.09, after climbing 0.36% on Thursday.

The index fell to a five-month low this week as earlier

hopes for growth-friendly policies under Trump have given way to

anxiety that the global trade war he started could trigger a

U.S. recession.

The yen was weaker on the day at 149.50 per

dollar. Still, the yen is up 5% this year on expectations that

the BOJ will hike rates again in 2025.

Data showed Japan's core inflation hit 3.0% in February and

an index stripping away the effect of fuel rose at the fastest

pace in nearly a year, a sign of broadening price pressure that

reinforces market expectations of further hikes.

"Although Governor Ueda made much of the risks surrounding

U.S. trade policy on Wednesday, we think he's just hedging his

bets - considering it a risk factor," said Min Joo Kang, senior

economist at ING.

"Therefore, if trade tensions don't escalate more than the

market currently expects, they won't affect the BOJ's rate hike

plans."

In commodities, oil prices rose on Friday, poised for their

strongest weekly performance since January.

Brent crude futures climbed 0.36%, while U.S. West

Texas Intermediate crude futures were up 0.4%. Both were

set for 2% gains for the week.

Gold eased 0.46% to $3,030 as investors booked

profits after the yellow metal climbed to a record high in the

previous session. Gold was on course for the third straight week

of gains, supported by safe-haven demand.

(Editing by Kate Mayberry and Kim Coghill)