MSCI Asia ex-Japan edges higher after Wednesday"s jump Strong U.S. inflation data not expected to change rates outlook China seen set to unveil more easing Dollar falls below key support SHANGHAI, Jan 13 (Reuters) - Asian shares were mixed on Thursday, while the dollar slipped as global investors assessed that strong U.S. inflation data was not worrying enough to change the Federal Reserve"s already hawkish rates outlook. While the U.S. consumer price index rose 7% in the 12 months through December, the biggest annual increase in nearly 40 years, investors were reassured by the fact that the jump was not a surprise, as the Fed looks set to raise rates as soon as March. read more Markets in Asia, where inflation pressures have generally been more subdued in major economies, could offer attractive risk hedging opportunities, said Jim McCafferty, Nomura"s joint head of APAC equity research. "If you are a global investor and you"ve seen very significant stock market gains in the U.S. during 2021, if you are seeing inflation as a threat then a lot of investors may be tempted to reallocate funds away from developed equity markets in the West into the mix of developed and developing markets in East Asia," he said. MSCI"s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was 0.1% higher, after recording its biggest daily gain in a month on Wednesday. Japan"s Nikkei (.N225) lost 0.87% after surging nearly 2% a day earlier. Australian shares (.AXJO) climbed 0.42% while Chinese blue-chips (.CSI300) slipped 0.28%. The uneven performance in Asia followed small gains on Wall Street overnight, with the S&P 500 (.SPX) rising 0.28% and the Nasdaq Composite (.IXIC) up 0.23%. The Dow Jones Industrial Average (.DJI) rose 0.11%. The People"s Bank of China is set to unveil more easing steps to support slowing growth, though it is likely to avoid aggressive cuts to interest rates, policy insiders and economists. read more The comments underscore the divergence in economic and policy outlooks between the world"s two largest economies. While longer-dated U.S. yields dipped after Wednesday"s inflation data, Fed fund futures are pricing in nearly four rate hikes this year. Some analysts say that there could still be room for a more aggressive rate hike schedule. "Our expectation for sustained cyclical price pressures means that we think the Fed will continue to tighten policy into 2023 by more than investors currently anticipate," Jonathan Petersen, markets economist at Capital Economics said in a note, adding that he expected the U.S. 10-year yield to reach 2.25% by year-end, and 2.75% by the end of 2023. On Thursday, the U.S. 10-year yield edged up to 1.7499% after dipping on Wednesday to close at 1.725%. The policy-sensitive 2-year yield was up at 0.9229% from Wednesday"s close of 0.907%. Wednesday"s drop in Treasury yields hit the dollar, which fell below key support levels on Thursday. The dollar index was last down 0.05% at 94.963, while the greenback crept up against the yen to 114.60. The euro was little changed at $1.1443. Oil prices ticked lower, a day after hitting their highest in nearly two months on the back of a falling dollar, tighter supply, and as investors bet the spread of the Omicron novel coronavirus variant would have a relatively limited economic impact. Global benchmark Brent crude fell 0.07% to $84.61 per barrel and U.S. West Texas Intermediate crude edged down to $82.58 per barrel. Spot gold held steady at $1,824.54 an ounce.