Asian shares edged mostly lower on Tuesday as investors weighed China’s loan prime rate decision, after its central bank cut some of its key lending rates in response to the slow recovery from the pandemic.
As of 9.38 A.M. Bangkok time, the Shanghai Composite in mainland China was down 0.36%, while Hong Kong’s Hang Seng index slid 1.21%.
On Tuesday, the People’s Bank of China (PBOC) cut its prime rate for one-year loans to 3.55% and for five-year loans to 4.20%.
There was little improvement in mood despite Chinese central banks lowering lending rates for the first time in 10 months. The reduction to the five-year rate was slightly smaller than some predictions.
In Australia, the S&P/ASX 200 climbed 0.48%.
South Korea’s Kospi also continued its slide from Monday, falling 0.37%.
Meanwhile, the Nikkei 225 in Japan dropped 0.60%.
The U.S. markets were closed on Monday for the Juneteenth holiday, but stock futures began the week lower as investors anticipated a trading-shortened week.
The Dow Jones Industrial Average futures fell 0.26%, and the S&P 500 futures lost 0.16%. Futures on the Nasdaq 100 index dropped by 0.15%.
Looking ahead, Fed Chair Jerome Powell will address Congress on Wednesday for his semiannual report. New York, Chicago, and St. Louis Fed presidents will speak this week as well.
The Fed left interest rates unchanged last week but signaled future tightening. The latest decision suggests two more quarter-point rate hikes, or a half-point rise, before the end of the year, with predictions for 5.6% borrowing rates in 2023.