Asia Stocks Fall As Chinese Inflation Heats Up

PAMELA SAMPSON

BANGKOK (AP) — Asian stocks fell Thursday after data showed inflation in China was heating up again, complicating efforts by Beijing to stimulate the world's No. 2 economy. A snag in talks to prevent Greece going bankrupt also weighed on sentiment.

Benchmark oil hovered below $99 per barrel while the dollar rose against the euro and the yen.

Japan's Nikkei 225 index slipped 0.2 percent to 9,002.12 after a government report showed a decline in machinery orders. South Korea's Kospi fell 0.4 percent to 1,996.51. Hong Kong's Hang Seng lost 0.5 percent to 20,910.52 and Australia's S&P ASX/200 shed 0.3 percent at 4,279.80.

Investor sentiment hit a hurdle after China released data showing consumer prices had risen 4.5 percent in January over a year earlier, up from the previous month's 4.1 percent. Food prices jumped 10.5 percent, driven by a 25 percent gain in the cost of pork, the staple meat in China.

The People's Bank of China eased lending curbs in December to promote growth in the slowing economy. But the unexpected jump in the cost of living could make the central bank wary of carrying out further steps to loosen credit.

"They will not be relaxing monetary supply anytime soon," said Francis Lun, managing director of Lyncean Holdings in Hong Kong. "Actually that shows the economy, despite the various tightening measures, is still relatively strong."

Elsewhere, Japan's core machinery orders for December 2011 fell by 7.1 percent on a seasonally adjusted basis, the Cabinet Office said. The figure, which excludes the volatile shipping and electric power industries, marked a downturn from a 14.8 percent expansion in November.

Hitachi Construction Machinery lost 1.7 percent, and construction machinery maker Komatsu shed 1.4 percent.

Australia mining companies came under pressure a day after BHP Billiton Ltd., the world's biggest miner, announced a 5.5 percent drop in first-half profit. BHP shares fell 2 percent.