Asian markets were mixed on Monday after data showed U.S. inflation was rising slightly, but Federal Reserve Chairman Jerome Powell said the numbers were “unexpected.” It is consistent with that.”
Traders also rejoiced at a significant increase in Chinese factory activity, raising hopes that the world’s second-largest economy may have hit rock bottom.
The rise comes after the Dow and S&P 500 closed at record highs on Thursday, with the latter posting its best first quarter since 2019.
The much-awaited numbers on the personal consumption expenditures (PCE) index, the Federal Reserve’s preferred measure of inflation, showed a modest year-over-year increase in March compared to February, although the core measure eased slightly.
Powell said the report was “generally consistent with our expectations” and that policymakers were on track to meet their long-term inflation target of 2%.
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He said that while recent inflation numbers were higher than the Fed had hoped, February’s numbers were “definitely in line with what we would expect.”
The data appears to have had little impact on traders’ expectations for a June rate cut, although Powell warned that it was unlikely to fall to levels seen after the 2008 global financial crisis.
Friday’s news follows an unexpected upward revision to fourth-quarter U.S. economic growth announced Thursday, which some observers say could complicate the Fed’s plans to cut borrowing costs. he pointed out.
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In early Asian trade, Seoul, Singapore and Manila rose, but Taipei and Jakarta fell.
Hong Kong, Sydney and Wellington remained closed for Easter.
Shanghai markets rose about 1% as traders welcomed news that China’s manufacturing sector grew for the first time in six months, giving a boost to leaders struggling to revive the struggling economy.
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March’s reading of 50.8 marked the first expansion since September and was well above expectations.
“The industrial sector seems resilient, helped in part by strong exports,” said Zhang Zhiwei of Pinpoint Asset Management.
“Economic momentum could improve if fiscal spending increases and exports remain strong.”
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However, the Tankan survey closely watched by the Bank of Japan showed that confidence in Japan’s largest manufacturing industry, which had been rising for three consecutive quarters, fell in the first quarter, sending Tokyo markets down more than 1%. .
The yen hit a 34-year low against the dollar on Wednesday, before stabilizing and rising slightly over the weekend.
Tokyo – Nikkei Stock Average: down 1.5% to 39,765.22 (break)
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Shanghai – Overall: up 1.0% to 3,071.00
Hong Kong – Hang Seng Index: Closed due to public holiday
Dollar/JPY: down to 151.27 yen from Thursday’s 151.39 yen
EUR/USD: down from $1.0789 to $1.0786
GBP/USD: increased from $1.2619 to $1.2629
EUR/GBP: down from 85.47p to 85.42p
West Texas Intermediate: up 0.3% to $83.45 per barrel
Brent crude: up 0.3% to $87.23 per barrel
New York – Dow: up 0.1% to 39,807.37 points (close price)
London – FTSE 100: up 0.3% to 7,952.62 (close)
Dan/MTP
