I think it's great that your daughter wants to learn to knit, and since enthusiasm is one of the keys to learning, I'd go ahead a try to teach her now.
There's really no set age for when kids can learn a new skill-alot of it depends on interest, ability to concentrate on one thing for longer periods, ability to manipulate the needle, and so on. Some kids will be ready by age 4 or 5, while others won't be ready for several more years.
I would encourage you to go ahead and try to teach her, and you'll soon have a good idea if she's ready or not. I wrote an article on this topic awhile ago, and you can find it at this url: http://www.bellaonline.com/articles/art1130.asp
If you find it too frustrating to teach her but she still wants to learn, consider enrolling her in a club or course through a local craft store, youth center, etc. My grandmother taught me to knit initially, but I really embraced it while working on a craft badge in Brownies, so look around your community for similar opportunities.
Good luck to you and your daughter!