* Taiwan dlr eases after Chinese data, despite foreign buying
* Taiwan central bank buys US$ to steady forex rate - dealer (Updates to close)
TAIPEI, March 11 - The Taiwan dollar closed flat on Thursday on suspected central bank intervention and a slackening of foreign fund inflows as Chinese economic data rippled through Asian markets.
Taiwan's monetary authority, keen to keep the foreign exchange rate stable and discourage hot money in the currency market, capped earlier gains with purchases of U.S. dollars in late trade, dealers said.
The funds had bought a net T$2.75 billion ($90 million) in Taiwan stocks <.TWII> on Thursday for a month-to-date total of T$54.5 billion after net sales in February.
Stocks fell around Asia, including Taiwan, on Thursday as investors fretted over tighter monetary policy in China on the back of strong loan growth and quickening inflation, although losses were limited by a market view that Asia's economic recovery remains on track.
"The (U.S. dollar-Taiwan dollar) pairing came off levels around T$31.750 near midday as risk aversion reared its head on China tightening fears," Forecast Ltd said in a report.
Chinese data showed that the giant economy grew at a brisk pace, while inflation hit a 16-month high. [ID:nTOE62806N]
Foreign funds have also favoured Taiwan's markets this week as they expected the export-reliant island and economic powerhouse China, political rivals for six decades, to sign a free trade-style agreement in early 2010, dealers said.
The local currency has climbed 0.84 percent this year but remains among the worst performers in Asia. (See [EMRG/FRX] for a table on Asian currencies' performance.)
The Taiwan dollar is expected to track local stocks in the near term with the central bank moving to keep the price in check, a dealer in Taipei said.
