* Dollar jumps after Fed signals steady increases
* Asian shares slip, Japan bucks trend
* U.S., European bond yields hit multi-week highs
* Euro stages tentative recovery as ECB meets
* Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh
By John Geddie
LONDON, Jan 19 (Reuters) - The dollar rebounded, Asian shares slipped and government bond yields soared to multi-week highs on Thursday after U.S. central bank chief Janet Yellen signalled a path of steady interest rate increases for the world's largest economy.
The European Central Bank was set to meet as the euro recovered some of the ground it lost overnight, but with no policy changes expected. However, hints of disagreements among the region's monetary guardians could ruffle markets .
European stocks opened a tad higher with some big moves in single stocks, as Zodiac Aerospace surged following a takeover offer, and Moneysupermarket.com jumped after it reported strong results.
Asian shares edged down 0.2 percent, knocked back by the dollar. The U.S. currency recovered from some of the weakest levels seen since early December after President-elect Donald Trump expressed concern in a weekend interview about the effects of a stronger greenback.
On Wall Street overnight, stronger financial shares helped push up the S&P 500, though the Dow Jones Industrial Average edged down.
Yellen will speak again later on Thursday, after European markets close, about the economic outlook and monetary policy.
"Of all the speakers we're getting, either from Davos or from less ostentatious spots, the one I'm going to listen to most for now will probably still be Janet Yellen," Societe Generale's currency strategist Kit Juckes said.
"As the U.S. economy approaches full employment, as wages rise but inflation rises nearly as quickly, how hawkish the Fed dares to be will determine how much the dollar rises."
The dollar gained almost one percent from Thursday's lows against a basket of currencies after Yellen's comments that she and other policymakers expected to raise rates a few times a year until 2019.
The affects appeared to be wearing off on Thursday, though, as investors, desperate for further details on Trump's plans to boost growth, remained cautious before the President-elect's inauguration on Friday.
Euro zone government bonds were still moving in the slipstream of Yellen's speech with benchmark German bond yields spiking to one-month highs after U.S. equivalents rose to their highest since Jan. 9.
Earlier in Asia, short-term funding costs in China shot to their highest in nearly 10 years on fears that liquidity was tightening heading into the Lunar New Year holidays at the end of this month.
"The market is typically short of liquidity ahead of the Lunar New Year," said Gu Weiyong, chief investment officer at bond-focused hedge fund Ucom Investment Co, adding that a cash injection by the central bank was insufficient.
Bucking the trend of weaker Asian shares, Japan's Nikkei stock index ended up 0.9 percent, helped by weaker yen .
The pound rebounded above $1.23 on Thursday after a wild few Brexit-fuelled days that has seen both its biggest rise in decades against the dollar and two of its heaviest slumps in months.
Crude oil prices regained some ground lost in the previous session when the dollar strengthened as investors turned their attention to upcoming government data on U.S. inventories. A stronger dollar makes dollar-denominated commodities more expensive for those holding other currencies.
U.S. crude added 0.8 percent to $51.50 per barrel, after shedding 2.67 percent on Wednesday. Brent crude rose 0.7 percent to $54.32 after slipping 2.79 percent.
For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets (Additional reporting by Patrick Graham in London and Lisa Twaronite in Tokyo; edting by Larry King)