U.S. PPI, Japan shunto , China MLF

Asia-Pacific markets fell Friday after producer prices in the U.S. grew at a faster than expected 0.6% in February.

Excluding food and energy prices, core PPI climbed 0.3% in February. Economists polled by Dow Jones had expected a 0.3% gain for headline PPI and a 0.2% increase for the core reading. 

Investors in Asia will be watching out for any news from Japan’s spring wage negotiations, with first estimates expected to come out later in the day.

Japan’s Nikkei 225 fell 0.4% at open, while the Topix edged 0.3% higher.

South Korea’s Kospi shed almost 1%, while the smaller-cap Kosdaq dropped 0.9%.

China’s central bank will also be in focus, with the People’s Bank of China expected to keep its one-year medium term lending facility rate unchanged at 2.5%, according to a Reuters report.

Futures for Hong Kong’s Hang Seng index stood at 16,798, also pointing to a lower open compared with the HSI’s close of 16,961.66

In Australia, the S&P/ASX 200 fell 1.55% to hit its lowest level in about three weeks.

Overnight in the U.S., all three major indexes lost ground as the hot inflation report sent bond yields higher, with the benchmark 10-year Treasury adding about 10 basis points to 4.29%.

This put pressure on equities, with the 30-stock Dow down 0.35%. The Nasdaq Composite fell 0.3%, while the S&P 500 slipped 0.29%.

— CNBC’s Brian Evans and Lisa Kailai Han contributed to this report