The euro hit a one-month high and Asian shares climbed for a seventh consecutive day on Tuesday while commodities rose and the dollar eased after a deal on new debt targets for Greece and a political agreement on disbursing the next installment of aid.

After 12 hours of talks at their third meeting in as many weeks, Greece's international lenders agreed on a package of measures to cut Greek debt to 124 percent of gross domestic product by 2020, and pledged to take further steps to lower the debt below 110 percent of GDP in 2022.

Eurogroup Chairman Jean-Claude Juncker said ministers would formally approve the release of crucial aid for debt-stricken Greece, removing uncertainty over whether Athens could avoid a near-term bankruptcy.

Investors' focus is likely to shift now to another major concern hanging over markets, a looming U.S. fiscal crisis.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> gained 0.6 percent to its highest level in nearly three weeks, led by a 1 percent advance in Korean shares <.KS11> and a 0.6 percent rise in Australian shares .

"The news of the Greek debt deal, plus U.S. fiscal cliff talks resuming this week, has spurred investor appetite," Kim Young-joon, an analyst at SK Securities, said of Korean stocks.

Republicans in the U.S. Congress on Monday called on President Barack Obama to detail long-term spending cuts to help solve the country's fiscal crisis, while holding firm against the income tax rate increases for the wealthy that Democrats seek.

"Now people will start focusing on the U.S. fiscal cliff and there could be some nervousness there, particularly if it drags on," said Burrell & Co dealer Jamie Elgar of Australian shares.

The euro gained as much as about 0.3 percent to $1.3010, its highest level since October 31, in reaction to the Greek news, before paring most gains to be up 0.1 percent at $1.2982.

Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo, cautioned that the euro still faced downside risks as the latest agreement does not offer a fundamental resolution to the euro zone's debt crisis.

"The euro gained but the rise is small, and it's unlikely that it will climb further, with big funds winding down their positions ahead of the year-end. Any rise will be countered by selling to cap the euro's upside," Maeba said.

Japan's Nikkei stock average <.N225> edged up 0.4 percent, nearing Monday's seven-month closing high. The benchmark has climbed more than 8 percent in two weeks as the yen has weakened on expectations of easier monetary policy with the likely election of a new government.

WEAK USD, CHINA HELP COMMODITIES

The dollar was down 0.1 percent against the yen at 82 yen.

Traders said some investors unwound long positions in the dollar built up in recent weeks on expectations that a new government for Japan, which is likely to be installed after next month's election, will pressure the central bank to pursue aggressive monetary easing.

The dollar eased 0.2 percent against a basket of key currencies , helping to underpin dollar-based commodities.

U.S. crude futures rose 0.3 percent to $88.03 a barrel and Brent was up 0.2 percent to $111.12.

Spot gold was up 0.1 percent to $1,749.30 an ounce, just below a six-week high of $1,754.10 hit on Friday.

London copper inched up 0.1 percent and hit a near one-month high as the Greek debt deal added to confidence over demand for copper after recent positive data from its top consumer China.

Sentiment may be further underpinned by a report saying China has approved construction of two city subway projects worth 49 billion yuan ($7.87 billion), adding to the list of recent railway project approvals aimed at boosting growth in the world's second biggest economy.

In another possible sign of economic recovery, China's industrial profits in October were up 20.5 percent from a year earlier, accelerating from 7.8 percent growth in September.

Asian credit markets firmed slightly, narrowing the spreads on the iTraxx Asia ex-Japan investment-grade index by 1 basis point.

(Additional reporting by Ayai Tomisawa in Tokyo, Joyce Lee in Seoul and Victoria Thieberger in Melbourne; Editing by Edwina Gibbs & Kim Coghill)