Asia-Pacific shares resumed declines on Friday, taking the lead from losses on U.S. Wall Street as investors braced for some upcoming economic data. In November, the core consumer price index in Japan increased at an annualized rate of 3.7%, the highest rate since December 1981.
As of 9.33 A.M. (Thai time), the Nikkei 225 fell 1.31%. Australia’s S&P/ASX 200 was down 0.85% and South Korea’s Kospi also fell 1.69%.
Hong Kong’s Hang Seng index dropped 0.54%. Mainland China’s Shanghai Composite lost 0.18%.
U.S. equities fell sharply overnight as the year-end selloff continued after a brief pause this week, putting an end to investors’ hopes for a Christmas rally.
US data showed a resilient economy, raising concerns that the Fed has more time to bring down inflation. In the week ended Dec. 17, initial unemployment claims climbed less than expected, indicating labor market strength. Spending rose, revising third-quarter GDP to 3.2% from 2.9%.
As the yen and local bond yields climb following the Bank of Japan’s hawkish announcement this week, Japanese investors may be tempted to bring home some of the trillions of dollars they have invested abroad. That could raise global borrowing costs and slow economic development, especially for euro zone bonds.