Asian Markets Trade Mixed ahead of U.S. Federal Reserve Meeting

Wednesday saw mixed trading in Asia as investors waited for the Federal Reserve’s interest rate decision later in the day and considered the potential of a Chinese economic stimulus package.

Australia’s S&P/ASX 200 rose 0.66% as of 9:13 a.m. Bangkok time, as the country’s inflation rate fell to 6% from 7% in the first quarter.

The Nikkei 225 in Japan was marginally higher.

The Kospi in South Korea lost 0.89%.

The Hang Seng in Hong Kong fell by 0.43%, and the Shanghai Composite in mainland China dipped by 0.09%.

Overnight, U.S. markets across the board rose, with the Dow Jones Industrial Average extending its winning streak to a 12th day.

The 30-stock index posted its longest climb since February 2017 with a gain of 0.08%, while the broader S&P 500 rose 0.28% and the tech-heavy Nasdaq Composite added 0.61%.

Later in the day, following a two-day meeting, the Federal Reserve is widely predicted to approve what would be the 11th increase in interest rates since March 2022.

Investors are pricing in a 100% chance that the central bank will approve a rate raise of 0.25 percentage points, bringing the Fed’s goal range for its benchmark borrowing rate to 5.25%-5.5%. The federal funds rate target would then rise to its highest level since January 2001.

China’s top authorities this week signaled policy support for the COVID-ravaged economy, and investors are still considering the possibility of a stimulus package.

China would conduct its macro changes “in a precise and forceful manner,” according to official media, though no specifics on a potential stimulus were provided.