Global Markets:
- Asian Stock Markets : Nikkei down 0.47%, Shanghai Composite down 0.43%, Hang Seng up 0.18% ASX up 0.44%
- Commodities : Gold at $2327.5 (1.17%), Silver at $29.48 (-3.31%), Brent Oil at $82.23 (-0.39%), WTI Oil at $78.17 (-0.39%)
- Rates : US 10-year yield at 4.31, UK 10-year yield at 4.32, Germany 10-year yield at 2.52
News & Data:
- (USD) Core CPI m/m 0.2% vs 0.3% expected
- (USD) CPI m/m 0.0% vs 0.1% expected
- (USD) Federal Funds Rate 5.5% vs 5.5% expected
Markets Update:
Asia-Pacific markets rose on Thursday after the U.S. Federal Reserve maintained the federal funds rate at 5.25% to 5.5% and revised its “dot plot” to project only one rate cut this year, down from three cuts projected in March. The dot plot also suggested a more aggressive rate-cutting path for 2025, anticipating four cuts totaling a full percentage point, up from three.
South Korea’s Kospi led the gains, rising 1.39% and heading for a third consecutive day of growth, with the small-cap Kosdaq up 0.6 Australia’s S&P/ASX 200 rebounded from two days of losses, climbing 0.4%. Hong Kong’s Hang Seng Index opened 1.23% higher, driven by gains in electric vehicle stocks despite the European Union imposing tariffs of up to 38% on Chinese EV manufacturers. BYD surged over 6%, with Nio and Li Auto shares rising by 2.77% and 1.85%, respectively. The mainland Chinese CSI 300 increased by 0.12%.
The Fed’s post-meeting statement noted that “inflation has eased over the past year but remains elevated,” with new language indicating “modest further progress toward the Committee’s 2 percent inflation objective” compared to the previous statement’s mention of “a lack of further progress” on inflation. Separately, May inflation remained unchanged from April, increasing by 3.3% year-on-year and staying flat on a month-on-month basis.
Overnight in the U.S., all three major indexes rose in response to the Fed’s decision and the May inflation reading. The S&P 500 hit a record high, closing above 5,400 for the first time, climbing 0.85% to end at 5,421.03. The Nasdaq Composite gained 1.53% to reach a record high, while the Dow Jones Industrial Average slipped by 0.09%.
Upcoming Events:
- 12:30 PM GMT – USD Core PPI m/m
- 12:30 PM GMT – USD PPI m/m
- 12:30 PM GMT – USD Unemployment Claims
