* Stocks subdued amid spike in key debt yields
* Euro flat after rallying on euro zone data, Greek debt hopes
* Qatar stocks weighed down by FIFA scandal
By Marc Jones
LONDON, June 3 (Reuters) - German debt yields added to their biggest jump in almost three years and the euro held on to most of its gains on Wednesday, as investors waited to hear the ECB’s view of a turbulent run for markets and its hopes for a Greek aid deal.
Markets were generally calmer after Tuesday’s heavy sell-off in benchmark government bonds and a mauling of the dollar by the euro following upbeat euro zone inflation data.
European shares nudged higher, with Greek stocks up for a third day running and buyers moving back into southern euro zone bonds from Italy, Spain and Portugal despite an ongoing shift away of core markets.
The scandal engulfing world soccer’s governing body FIFA weighed on stocks in Qatar amid concerns its winning bid for the 2022 World Cup might be re-examined, but attention was primarily on Wednesday’s European Central Bank meeting.
The bank made no changes to its interest rates or quantitative easing (QE) programme. But new forecasts at its 1230 GMT news conference are expected to show inflation is back on the rise, while its stance on Greece and the sharp sell-off in debt markets currently undermining its bond-buying scheme will be of key interest.
“Greece will be one topic and probably another one is going to be how markets are developing,” said UniCredit interest rate strategist Luca Cazzulani.
“Since their last meeting (in mid April) there has been quite a lot of pricing in of a rise in inflation expectations, and there has been a big rise in bond yields which they will want to address.”
There is plenty of other news scheduled too. Poland, eastern Europe’s biggest economy, kept its interest rates unchanged while Brazil, Latin America’s largest, is expected to raise its rates later. On top of that there will also be another flurry of U.S. data ahead of Friday’s non-farm payrolls.
U.S. stock index futures were pointing 0.5 percent higher ahead of the ECB news conference and the dollar was also up as the euro took a breather at $1.1115. The euro zone’s currency had jumped 2.1 percent on Tuesday in its second biggest daily gain since Oct. 2011.
For the greenback, though, it was only a small recovery following the previous day’s beating. Momentum was also back with the Australian dollar as it gained following strong GDP data that dealt another blow to rate cut hopes there.
The Paris-based Organisation for Economic Co-operation and Development (OECD), a think-tank funded by its mainly wealthy member nations, underscored the still stuttering state of the world economy as it cut its 2015 growth forecast to 3.1 percent.
Asian share markets had been generally subdued overnight. Japan’s Nikkei lost 0.3 percent and Australian shares shed 1.1 percent on the bounce in the Aussie dollar.
“It most probably puts a floor under any further RBA easing at this stage, this is pretty much in line with their expectations,” Michael Workman, senior economist at CBA in Sydney, said of the country’s GDP data.
There were minor gains for Thailand and Malaysia but Shanghai’s Composite Index lost 1.4 percent on a string of initial public offerings and Indonesian stocks also slipped.
With German bund yields still rising in Europe, U.S. Treasury yields also nudged up 2.3 percent to test their highest levels of the year as investors continue to debate whether U.S. rates will rise this year.
Lower-rated European debt fared better on improved prospects of a reforms-for-cash deal for Greece, which could avert a Greek default and its potential exit from the currency union.
Greece’s creditors on Tuesday drafted the broad lines of an agreement to put to the leftist government in Athens. But uncertainty remains whether Prime Minister Alexis Tsipras will accept the deal if it involves cuts in pensions and job protection, areas he has pledged to shield.
Greek 10-year yields fell 24 bps to 11.16 percent. Portuguese, Spanish and Italian equivalents were all 6-7 bps lower at 2.77 percent, 2 percent and 2.03 percent, respectively.
In commodities, oil lost a dollar as traders bet that OPEC would not cut output at its latest meeting in Vienna on Friday following a recent rebound in prices.
Gold also struggled at $1,190 an ounce and China-attuned metal copper barely budged, despite data showing new business in the country’s services sector rose at the fastest pace in three years.
Additional reporting by Wayne Cole in Sydney; editing by Gareth Jones