Asia stocks subdued after Powell testimony fails to surprise
Timilehin Adejumobi
1 min read
Asian shares made a tentative start to Thursday after Federal Reserve chair Jerome Powell stuck to his recent hawkish tone as investors assess the future rate policy path from the Fed.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was marginally lower at 522.93. The index is down over 2% for the week and set to snap its three week winning run.
Australia’s S&P/ASX 200 index (.AXJO) lost 1.17%, while Japan’s Nikkei (.N225) eased 0.25%. China and Hong Kong stock markets are closed for a holiday.
Last week, the Fed held its benchmark interest rate steady at level between 5% and 5.25%, but officials projected rates will have to increase another half percentage point by year’s end to tame inflation.
Markets though remain unconvinced, pricing in a 25 basis point hike next month, according to CME FedWatch tool, and no more after that.
Powell in his remarks to lawmakers in Washington said the outlook for two further 25 basis point rate increases are “a pretty good guess” of where the central bank is heading if the economy continues in its current direction.
This report’s information was first seen on REUTERS; to read more, click this link.
