Asian Stock Market Falls Focus on Fed
2023.02.21 01:33
Asian Stock Market Falls Focus on Fed
By Kristina Sobol
Budrigannews.com – On Tuesday, investors looked to the minutes of the most recent Federal Reserve meeting for additional hints regarding monetary policy as the possibility that the U.S. central bank would have to maintain its hawkish stance weighed on sentiment. As a result, Asian stocks edged lower.
MSCI’s broadest index of Asia-Pacific shares outside of Japan fell 0.34 percent to 531.85, remaining close to its previous week’s six-week low of 529.30.
After rising 8.6% in January, the index is down nearly 3% this month as a slew of robust U.S. economic data reinforced concerns that interest rates may need to rise further and remain higher for a longer period of time.
Rather than anticipating further rate cuts this year, the market now predicts that U.S. interest rates will reach a peak of 5.30 percent in July and remain above 5 percent through the end of the year.
was up 0.01%, while Australia’s was down 0.52%. Hong Kong’s shares were expected to open 0.1% lower, while China’s were expected to open flat.
According to strategists at Saxo Markets, “the backdrop of inflation concerns in the U.S. is still keeping risks of a tighter than expected monetary policy,” and “yields remain a key focus as U.S. markets return later today.”
Due to the President’s Day holiday, U.S. markets were closed on Monday.
After reaching a three-month high of 3.929% on Friday, the yield on was up 3.5 basis points to 3.863% on Saturday.
The yield on the 30-year Treasury bond increased by one basis point to 3.89 percent, while the yield on the two-year U.S. Treasury paper, which typically moves in accordance with expectations regarding interest rates, increased by 5.4 basis points to 4.677%.
The minutes of the Federal Reserve’s most recent meeting, at which the central bank raised interest rates by 25 basis points, will be made available to the public on Wednesday.
As a three-week rally faded in the currency market, traders looked to Tuesday’s manufacturing data from Europe and the United States and Friday’s core PCE price index for direction. The dollar was just shy of recent highs. After the strong readings for U.S. nonfarm payrolls and CPI this month, DBS currency strategist Philip Wee stated that the market is anticipating another surprise in the PCE data.
The, which compares the dollar to six other currencies, was last at 104.01, just below its six-week high of 104.67 on Friday. The euro fell 0.12 percent to $1.0669, snapping four months of gains to finish February lower.
The yen fell 0.12 percent to 134.40 dollars per dollar, while sterling fell 0.13 percent to $1.2022.
Was at $83.80, down 0.32% on the day, up 1.02% to $77.12 per barrel.
