Asian stocks mixed, fears of China tightening linger

Hatoyama told a session of parliament that the world's second largest economy was not as strong as the yen's value might suggest and called for "firm steps" to prevent it from strengthening further.

After the comments the dollar picked up against the Japanese unit, trading at 90.62 yen in Tokyo from 90.48 in New York late Thursday. The euro was also higher at 124.21 yen from 123.77.

The yen surged to 14-year highs against the greenback in November, hitting 86.28 to the dollar at one point. A strong yen hurts the competitiveness of Japanese exporters and erodes their overseas earnings when they are repatriated.

The Nikkei finished at its best level since January 21, with the index 0.81 percent, or 86.31 points, higher at 10,751.26.

Hatoyama's intervention comes as the government ups pressure on the central bank to take more action to shore up the economy and combat deflation.

The market will now focus on a Bank of Japan meeting next week that could herald further moves to boost the economy.

Sydney edged 3.9 points higher to 4,818.1. BHP Billiton fell 0.4 percent to 42.85 Australian dollars, Rio Tinto rose 0.5 percent to 75.96 and Newcrest Mining was up 0.9 percent at 34.21.

Seoul rose 0.37 percent, or 6.12 points, to 1,662.74.

However, Shanghai fell 1.24 percent, or 37.87 points, to 3,013.41 on increasing concern Beijing will further tighten monetary policy to cap the economy's strong growth after figures showed inflation continued to accelerate,

The consumer price index rose 2.7 percent year on year in February; up from 1.5 percent in January and higher than a forecast 2.4 percent rise.

The government has already ordered banks to increase their capital reserves three times since December — effectively limiting the amount of money they can lend.

"The last time a hike in the reserve requirement ratio was announced on a Friday evening, so investors are remaining on the sidelines in case something similar happens later," Southwest Securities analyst Zhang Gang told Dow Jones Newswires.

Hong Kong ended marginally lower, dropping 18.46 points to 21,209.74.

Meanwhile China Friday hit back at U.S. President Barack Obama after he called for Beijing to adopt a "market-oriented" exchange rate policy, increasing pressure for a stronger yuan.

The United States and the European Union, key trade partners for China, say the leadership has intentionally kept the currency low to boost exports.

In other markets:

— Singapore closed 0.26 percent or 7.45 points higher at 2,881.36.

— Jakarta lost 0.37 percent, or 10.01 points, to 2,666.51.

— Kuala Lumpur lost 0.77 percent, or 10.23 points, to close at 1,311.20.

— Manila closed 1.68 percent, or 52.65 points, lower at 3,072.91.

— Wellington was flat, edging 1.69 points higher to 3,225.14.

— Bangkok closed 1.02 percent, or 7.39 points, higher at 733.34, d

— Mumbai closed flat, edging down 1.34 points to 17,166.62.

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