China inflation pushes most Asian markets lower

Trade had also been weighed by news that the Japanese economy did not grow as much as previously thought in the final quarter of 2009.

China's National Bureau of Statistics said the consumer price index, the main gauge of inflation, rose 2.7 percent year-on-year last month, faster than the 1.5 percent rise recorded in January.

The news led Chinese and Hong Kong markets lower before they rebounded thanks to dealers buying up cheap stocks.

Hong Kong rose 19.91 points to close at 21,228.20 while the Shanghai Composite Index, which covers both A and B shares, added 2.35 points to 3,051.28.

Data also showed new lending slowed to 700.1 billion yuan (US$102 billion) in February, from the previous month's 1.39 trillion yuan as Beijing tries to restrict liquidity in a bid to put the brakes on the economy.

The figures have caused concern there will be further restrictions.

"While we continue to believe that policy normalization/tightening should be gradual and measured this year, another reserve requirement ratio hike is likely imminent," Morgan Stanley analyst Wang Qing told Dow Jones Newswires.

China has taken steps to calm inflationary pressures by ordering banks to increase their capital reserves three times since December — effectively limiting the amount of money they can lend.

And Qian Qimin from Shenyin Wanguo Securities said: "The tightening concerns are still lingering."

Sydney closed 0.12 percent, or 5.8 points, at 4,814.2 after data showed unemployment rose to 5.3 percent in February from January's revised 5.2 percent.

Seoul closed 0.34 percent, or 5.62 points, lower at 1,656.62 after South Korea's central bank held the key interest rate at a record low 2.0 percent for a 13th straight month.

Markets broadly ignored upbeat U.S. data showing wholesale inventories unexpectedly fell 0.2 percent in January. Analysts expected inventories to rise 0.2 percent.

The government report also said sales by U.S. wholesalers in January rose 1.3 percent to a seasonally adjusted 346.7 billion dollars.

Despite data showing Japan's economy grew 0.9 percent in October-December from the previous quarter, down from an initial estimate of 1.1 percent, the Nikkei picked up due to a weaker yen.

Tokyo rose 0.96 percent, or 101.03 points, to 10,664.95

In other markets:

— Singapore closed 0.41 percent, or 11.62 points, higher at 2,873.91.

— Manila closed 0.19 percent, or 5.93 points, higher at 3,125.56.

— Jakarta rose 0.24 percent, or 6.3 points, to 2,676.52.

— Kuala Lumpur lost 0.51 percent, or 6.79 points, to close at 1,321.43.

— Wellington ended flat, edging 2.75 points lower to 3,223.45.

— Bangkok rose 0.71 percent, or 5.11 points, to close at 725.95.

— Mumbai rose 0.41 percent, or 69.63 points, to 17,167.96.

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