* Korea’s KOSPI off 1.2% after COVID-10 rebound * Australian shares down 0.7% as banks struggle, Nikkei loses 0.4% * UK share futures fall ahead of CPI data * Dollar strong versus yen, euro and sterling * Oil prices slip, gold up HONG KONG, Nov 17 (Reuters) - The dollar strengthened through key resistance levels on Wednesday, propelled by better-than-expected U.S. retail data, although the upbeat news was not enough to lift Asian shares, which were dragged by worries about COVID-19 and higher costs. ADVERTISEMENT MSCI’s broadest index of Asia-Pacific shares outside Japan skidded 0.5% from Tuesday’s near three-week closing high, and was set for its biggest fall this month, snapping seven days of gains. Japan’s Nikkei lost 0.3% on fears the strong dollar would mean higher costs for imported material for manufacturers. The dollar reached a high of 114.97 yen in early Asian hours, its strongest since March 2017, while the euro fell to $1.1263 its lowest since July 2020. The greenback was helped by Tuesday data which showed U.S. retail sales rose faster-than-expected in October, potentially encouraging the U.S. Federal Reserve to accelerate the tapering of its asset purchase programme, as inflation remains stubbornly high. These also weighed on U.S. Treasuries with benchmark 10-year note yields reaching 1.649% in early Asia, a three-week high. “The data backs up that sense that things are going pretty well, and the Fed can be a little more aggressive if it wants to be without completely causing the party to crash,” said Rob Carnell, head of research for Asia Pacific at ING. ADVERTISEMENT “Top of mind for everyone is inflation right now, it’s still an issue after the numbers we got from the U.S. yesterday, and we’ve got a whole barrage of other inflation data coming today, particularly the U.K. and Canada,” he added. Britain publishes its October inflation data later on Wednesday with a high print likely to add pressure on the Bank of England to raise rates in December after surprising markets by holding fire last month. FTSE futures slipped 0.37%, pointing to a weak open for British shares, while pan-region Euro Stoxx 50 futures and U.S. S&P 500 futures were flat. “What it’s not about is the Biden-Xi summit, which had the potential to do damage but seems not to have done so,” Carnell added. At a three-hour meeting on Tuesday, U.S. President Joe Biden and Chinese leader Xi Jinping turned down some of the heat in Sino-U.S. tensions, though both sides held to entrenched positions on a range of issues. The positive tone offered a slight boost to Asian shares on Tuesday, but this proved short-lived. ADVERTISEMENT On Wednesday, South Korea’s KOSPI fell 1.2% after the country reported its the second-highest daily new coronavirus infections since the pandemic began. Australian shares fell 0.7% weighed by Commonwealth Bank of Australia, the country’s largest bank, which slipped 8% after it flagged a hit to margins from the low interest rate environment and mortgage competition. Chinese blue chips were steady and the Hong Kong benchmark slipped 0.4%, as a short rally in developer and casino stocks ran out of steam. Oil prices slipped after data showed U.S. gasoline inventories fell more than expected last week, heightening pressure on U.S. authorities to release oil from emergency reserves. U.S. crude dipped 0.87% to $80.06 a barrel. Brent crude fell 0.5% to $81.69 per barrel. Spot gold rose 0.25% to $1,854 an ounce, climbing back towards the five-month high of $1,876.9 hit a day earlier on rising inflation concerns. Rival inflation hedge bitcoin slipped 0.8% to $59,500 having shed 5% a day earlier.