Markets mixed ahead of key rate decisions

Equities were mixed Monday in Asia with investors gearing up for policy decisions at major central banks this week, while concern over the Chinese economy continued to dampen sentiment.

With recent data releases suggesting inflation is now coming down after more than a year of interest rate hikes, hope is building that officials are close to bringing an end to their tightening cycles.

The key focus will be on the Federal Reserve, which is widely expected to announce another increase in borrowing costs, while traders are looking for guidance on its plans after that.

Debate is swirling about whether or not it will call it a day or keep going in order to bring inflation down to its two percent target, from the current three percent.

A string of positive data in recent months has given the Fed some room to take its foot off the pedal and allow the economy to avert a feared recession.

“The Fed should not signal another skip in September, as doing so for the June meeting really handcuffed the Fed at a time when it needed maximum flexibility,” said Win Thin at Brown Brothers Harriman & Co.

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