Asian stocks fell on Friday as a $447 billion jobs package from U.S. President Barack Obama failed to entice investors back into equities amid concerns that political wrangling could see it watered down.

Market confidence has been fragile after Western central banks failed to offer any fresh stimulus plans, and a looming deadline for bond holders to decide on Greece's swap offer also added to the nervousness.

European stocks may also slip with financial spreadbetters expecting key benchmarks to open 0.3-0.5 percent lower.

There was, however, better news from China, where consumer inflation appears to have peaked, with August numbers coming in slightly below July's three-year high, underscoring expectations the central bank can hold off on further monetary tightening as the global economy slows.

The euro edged higher against the dollar but remained near a two-month low reached on Thursday after a deepening debt crisis forced the European Central Bank to drop its tightening policy bias, a key driver in the euro's rally this year.

U.S. Treasuries slipped as markets reacted coolly to the job creation plan from Obama, who faces a fierce battle to win over Republican opponents in a divided Congress.

Global markets have been dominated in recent weeks by fears of a U.S. relapse into recession and Europe's snowballing debt crisis. Citigroup analyst Jonathan Stubbs said in a note on Friday that "recession appears to be a more likely outcome now in Europe and/or the U.S. than 3-6 months ago".

Worries about the darkening outlook for the developed world prompted Asian central banks including South Korea and Indonesia to hold interest rates steady on Thursday, following similar moves by Australia, Canada, Japan and Sweden this week.

The MSCI's broadest index of Asia Pacific shares outside Japan fell 0.3 percent and was on course for a weekly loss after two weeks in positive territory.

Some regional markets bucked the trend, though, with Australia and Taiwan, both heavily influenced by demand from China, posting gains.

The ex-Japan is down more than 16 percent from its 2011 high in April, after fears about the U.S. economy and Europe sparked a global market rout last month.

Japan's Nikkei fell 0.4 percent, but U.S. S&P 500 futures rose 0.3 percent, pointing to a stronger opening on Wall Street.

POLICY STIMULUS

The European Central Bank on Thursday discussed downside risks to the euro zone's economy, while U.S. Federal Reserve Chairman Ben Bernanke said in a speech that authorities would do all they can to boost growth and employment.

But both steered clear of announcing any fresh steps, disappointing some investors.

Wall Street's main indexes closed down around 1 percent, with banks the biggest decliners, after Bernanke gave no indications of new stimulus measures to support the flagging economy.

After the Wall Street close, Obama announced a package of tax cuts and government spending that will be critical to his re-election chances.

"To some extent, this was largely in line with the chatter we heard before it's release. It may even be a bit smaller than needed given the gravity of the problem," said Omer Esiner, senior market analyst at Commonwealth Foreign Exchange in Washington.

"And at the end of the day, it depends on what the finished product will be. A lot of this will be chopped up before it is passed. We've seen a lot of political paralysis in Washington."

Investors' focus will now turn to a meeting of G7 finance chiefs later on Friday, with the faltering global recovery and euro zone debt crisis likely to be the issues of the day.

EURO NEAR TWO-MONTH LOW

The dollar index eased 0.1 percent, while U.S. Treasuries traded in Asia slipped, giving back some of the previous day's rally.

Gold, propelled to a series of records in recent months due to its appeal as both a safe haven and hedge against inflation, fell around 0.4 percent to about $1,860 an ounce, after jumping 3 percent in the previous session.

Oil, which had dipped on Thursday as the dollar rose making it more expensive for holders of other currencies, edged higher, with U.S. crude futures up 0.1 percent around $89.14 a barrel and Brent crude up 0.2 percent at $114.76.

"The question for the oil market is on demand destruction and how confident the consumer is, both of which are very uncertain," said Jeremy Friesen, commodity strategist at Societe Generale in Hong Kong.

"If European and U.S. policymakers can find some compromise and willingness to work together before economics force their hand, then that is bullish for oil. But I think we will probably see the market grind sideways."