Asian Markets Edge Higher on Fed’s Signal for Slower Rate Hike

Asian markets traded mostly higher on Thursday after the U.S. Federal Reserve signaled for a smaller hike soon to avoid damaging the economy with its monetary policy.

As of 10:20 BKK time, Nikkei rose 1.18%, SSEC slipped 0.08%, Hang Seng Index gained 0.25%, Kospi increased 0.58% and ASX200 hiked 0.36%.

Thailand’s SET Index went off at the opening bell with a gain of 0.37%, but a sharp plunge afterward erased all momentum in the market.

Meeting minutes of the U.S. Fed officials earlier this month released Wednesday as one of positive signs in months after its November 2022 meeting that marked a sixth consecutive rate hike and the fourth straight three-quarter point increase, pushing borrowing costs to a new high since 2008.

The market widely expects the Fed to lower aggression in the final meeting of this year on December 14 for a 50 basis points.

However, the minutes showed that the Fed was looking toward a longer rate cycle as the terminal rate could exceed 5% per estimate of Fed’s officials, compared to an ultimate rate of 4.6% in the September meeting.