Asian Stock Markets Steady as Dollar Takes a Pause
Asian stock markets remained stable on Tuesday as the dollar paused, following resistance from central banks in China and Japan. Traders are also awaiting U.S. inflation data to determine if interest rates have peaked. The yen saw its best day against the dollar in two months after the Bank of Japan Governor mentioned that short-term rates may need to rise. The yuan also had its best day in six months after authorities promised to address one-way moves and the central bank increased scrutiny of dollar buying. However, both currencies are still near their lowest levels of the year. Japanese government bonds faced pressure, with yields reaching a fresh high of 0.71%.
U.S. Inflation Data and European Central Bank Meeting Awaited
Investors are looking forward to U.S. inflation data, set to be released on Wednesday. Expectations suggest that annualized core inflation will fall to 4.3% in August, while the headline number is expected to rise to 3.6%. A lower-than-expected figure could slow the rise of the U.S. dollar, while a higher figure may fuel dollar strength and reinforce expectations for further rate hikes. The European Central Bank meeting, scheduled later this week, will also impact interest rate expectations and market sentiment. The listing of British chip designer Arm Holdings in New York, aiming to raise nearly $5 billion, will test investors’ appetite for risk.
Currencies and Commodity Markets
The Australian dollar was weighed down by a slip in consumer sentiment, while the New Zealand dollar also dipped. The euro gained on the dollar but investors are cautious ahead of the ECB meeting. Benchmark 10-year Treasury yields remained steady. In commodity markets, Brent crude futures held steady at $90.59 a barrel. Gold maintained its value at $1,921 an ounce. However, bitcoin experienced a decline and dropped below $25,000 for the first time in three months.
Hot Take: Asian Stock Markets Stabilize as Dollar Pauses
Asian stock markets remained steady as the dollar took a break, influenced by resistance from central banks in China and Japan. Investors are eagerly awaiting U.S. inflation data and the European Central Bank meeting to gauge interest rate expectations. The yen and yuan both saw positive movements against the dollar, but are still near their lowest levels of the year. Japanese government bonds faced pressure, and U.S. futures slipped slightly in early Asia trade. The Australian and New Zealand dollars dipped, while the euro gained on the dollar. Benchmark 10-year Treasury yields held steady, and commodity markets saw stability in Brent crude futures and gold prices. However, bitcoin experienced a decline and dropped below $25,000.
By
By
By
By
By