Asian markets rose on Monday after Federal Reserve Chairman Jerome Powell said officials would take a careful approach to interest rate hikes.
The Fed’s decision to remain “data-dependent” in its decision-making on rates was welcomed by investors, who had been concerned that the central bank would continue to raise rates aggressively in an effort to combat inflation.
As Shayne Heffernan of Knightsbridge Research notes, “The Fed’s decision to take a more cautious approach is a positive development for markets. However, it is important to remember that the Fed is still likely to raise rates in the coming months, so investors should remain cautious.”
Chinese shares also rose after the government cut the duty on stock trades. This move is seen as a sign that authorities are willing to support the country’s economy.
Overall, the sentiment in Asian markets was positive on Monday. However, investors remain cautious, and it is likely that markets will remain volatile in the near term as the Fed continues to raise rates and the global economy slows.
- The Fed’s decision to remain data-dependent means that it will be closely monitoring economic data in the coming months before making any further decisions on interest rates.
- This approach is seen as a more balanced approach than the previous policy of raising rates aggressively in an effort to combat inflation.
- The Fed’s decision is likely to be welcomed by investors, who had been concerned about the prospect of a more aggressive tightening cycle.
- However, it is important to remember that the Fed is still likely to raise rates in the coming months, so investors should remain cautious.
- The Chinese government’s decision to cut the duty on stock trades is seen as a sign that authorities are willing to support the country’s economy.
- This move is likely to boost liquidity in the market and could help to support share prices.
- However, it is too early to say whether this move will be enough to prevent a further decline in Chinese stocks.
Shayne Heffernan
