Asian Shares Edge Higher after US Fed Delivers More Interest-Rate Warnings

Asia-Pacific stocks edged up on Friday as the U.S. Federal Reserve delivered more interest-rate warnings, while mounting coronavirus cases in China and liquidity strains in the country’s bond market added to the uncertainty.

As of 9.25 A.M. (Thai time), the Nikkei 225 was fractionally higher. The core consumer price index in Japan jumped 3.6% in October from a year earlier, which was faster than economists had predicted and the biggest annual increase in 40 years. According to Refinitiv data, the last time the country saw this level was in February 1982.

South Korea’s Kospi was up 0.63%. The S&P/ASX 200 in Australia gained 0.28%.

The Hang Seng Index rose 1.52%. In mainland China, the Shanghai Composite was about flat.

On Thursday, James Bullard, president of the Federal Reserve Bank of St. Louis, said the central bank still has a long way to go before it brings inflation under control. He also said the appropriate federal funds rate zone is between 5% and 7%, which is higher than what the market is pricing in.

Both the dollar and bond yields were shoved higher overnight following Bullard’s comment.

Overnight on Wall Street, equities fell with a number of Fed’s speakers indicating that more interest rate hikes are on the way.