Source: AFP
Asian markets rose on Tuesday after another record high on Wall Street, with all attention on the release of key US inflation data due later in the day.
Traders hope the consumer price index reading shows a continued downward trend, which would give the Federal Reserve room to cut interest rates.
However, there is resignation at trading levels that a cut in March is out of the question after policymakers warned they wanted to see more positive indicators, with May understood to be seeing the first downward turn.
According to Bloomberg News, the CPI report is forecast to be below 3% on an annual basis for the first time since March 2021.
Expectations that inflation will fall to the Fed’s two percent target this year, allowing the bank to ease monetary policy, have been a key driver of the market rally that has pushed the Dow and S&P 500 to multiple records this year.
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Asian markets were mixed ahead of US inflation data
However, some observers pointed out that there could be an upside surprise as many businesses had raised prices to boost their margins.
And SPI Asset Management’s Stephen Innes added: “The scary top side beat will throw cold water on the inflation easing story, drop the chance of a May rate cut south of 50% and reverse a stock market rally looking for more impetus from a neat Fed.
“The U.S. is not out yet on the inflation front, even if the markets want to pretend otherwise.”
As most of the region returned to work after a long weekend in many countries, Tokyo led gains thanks to a nearly 10 percent gain in SoftBank, boosted by another successful day for its U.S.-listed Arm unit .
The arm has nearly doubled in value in the past week — and tripled since its September listing — on healthy demand for chips fueled by an expected boom in artificial intelligence.
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Holiday-hit Asian markets mixed, Wall St records fail to inspire
Gains were also recorded in Seoul, Sydney, Singapore and Manila.
Hong Kong, Shanghai and Taipei remained closed for the Lunar New Year holiday.
The gains in Asia came after the Dow hit a new record high, although the S&P 500 fell after hitting an all-time high on Friday. The Nasdaq also fell slightly.
Keys around 02:30 GMT
Tokyo – Nikkei 225: UP 2.4 percent at 37,798.89 (break)
Hong Kong – Hang Seng Index: Closed for holidays
Shanghai – Composite: Closed for holidays
EUR/USD: DOWN at $1.0764 from $1.0776 on Monday
Dollar/yen: UP to 149.38 yen from 149.33 yen
GBP/USD: DOWN to $1.2616 from $1.2630
Euro/pound: UP at 85.33 pence from 85.29 pence
West Texas Intermediate: UP 0.1 percent at $77.01 a barrel
North Sea Brent crude: UP 0.1 percent to $82.04 a barrel
New York – Dow: UP 0.3 percent at 38,797.38 (close)
![](https://images.yen.com.gh/images/09c5f661919358cb.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/09c5f661919358cb.jpg?impolicy=cropped-image&imwidth=256)
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Chinese consumer prices fell the fastest in 14 years
London – FTSE 100: FLAT at 7,573.69 (close)
Source: AFP