Constituent policy

Asian Stocks Rise, Investors Brace for Latest Fed Policy Decision By

© Reuters.

By Gina Lee – Asia-Pacific stocks were mostly up Wednesday morning, and bonds are under pressure ahead of the U.S. Federal Reserve. Investors are bracing for the biggest interest rate hike since 2000 as they await further clues about how aggressively the central bank will tackle inflation.

South Korea edged down 0.03% at 10:33 p.m. ET (02:33 GMT).

In Australia, the decline of 0.07%, with the March 2022 figures published.

The Hong Kong index fell 0.99%.

Chinese and Japanese markets remain closed for holidays.

In the United States, and contracts have climbed higher. They were boosted by a second consecutive daily rally in US stocks, despite trading volatility on Tuesday.

Bonds fell as most central banks moved to tighten monetary policies, and yields rose in Australia and New Zealand. There are no cash transactions due to holidays in Japan.

In its policy decision, to be released later today, the Fed is expected to raise interest rates by 50 basis points and detail plans to shrink its balance sheet.

A key part of the decision will be comments from Fed Chairman Jerome Powell. If he were to make more hawkish comments than expected, it could raise concerns about an economic slowdown in the United States as borrowing costs rise.

“There’s a tough set-up in general for risky assets” as valuations remain stretched despite a decline in stocks, Kathryn Koch, Goldman Sachs & Co. LLC’s chief investment officer for equity markets, told Bloomberg. public. “Some people think stagflation is a real risk,” she added.

Swap traders have already fully priced the Fed’s half-point moves for June, July and September 2022, the most aggressive trajectory in three decades. However, any hint of a 75 basis point increase could have a negative impact on the markets.

On the data front, the was 55.4, while the index was 50.9, in April 2022.

“The Fed remains very focused on reducing inflation, however, any further hawkish pivot will likely be tempered to some extent by the desire to achieve a soft landing,” said US economist T. Rowe Price Group Inc. Blerina Uruci in a note.

The will make its policy decision on Thursday, and the U.S. jobs report for April 2022, including , will follow a day later.

Elsewhere, they remained near two-year highs. This reflected investor caution in the face of risks including monetary policy tightening, ongoing COVID-19 lockdowns in China and the war in Ukraine perpetrated by the Russian invasion on February 24.

Oil was trading near the $103 mark, with the Organization of Petroleum and Allied Exporting Countries (OPEC+) meeting virtually for its monthly meeting on Thursday. Gold has changed little.