* RBA expected to hold cash rate at 0.1% - Reuters poll
* Westpac falls on allegations of liquidity standards breach
* Santos upgrades 2020 production view, shares up 1.5%
Dec 1 (Reuters) - Australian shares on Tuesday clawed higher
from a sharp decline in the previous session, though rising
tensions with largest trading partner China kept gains in check
as investors awaited the central bank's decision on benchmark
The S&P/ASX 200 index was up 0.3% at 6,537.5 by 2350
GMT. The benchmark index closed 1.3% lower on Monday, but posted
a record monthly gain of nearly 10%.
The Reserve Bank of Australia is expected to hold its cash
rate at a historic low of 0.1% at its monthly policy meeting
later in the day, according to a Reuters poll.
The decision comes a day ahead of the third-quarter gross
domestic product data, which is expected to show a 2.5% growth
in the economy in September quarter, a rebound from a record 7%
contraction in the previous quarter, according to a Reuters
Limiting gains in the index were tensions between Canberra
and Beijing that flared after Australian Prime Minister demanded
an apology from Beijing over a fake image posted on social media
of an Australian soldier holding the knife to the throat of an
Relations between the two trading partners were already at a
low following the imposition of anti-dumping tariffs by China on
Australian wine imports.
Healthcare firms were the top boost to the index,
with CSL Ltd and Cochlear jumping 2% and 2.6%,
Financials were among the top drags on the
benchmark, with Westpac slipping as much as 1.2% after
country's prudential regulator said the bank breached liquidity
standards over the past two years.
Most blue-chip energy stocks declined amid a drop in
oil prices, though Santos gained up to 1.5% after the
gas producer raised its 2020 output forecast and lowered
production cost expectations.
In New Zealand, the benchmark S&P/NZX 50 index was
down 0.4% at 12,715.94, with financials weighing the most.
(Reporting by Sameer Manekar in Bengaluru, Editing by Sherry