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Asian Stocks Down Ahead of Latest Fed Meeting Minutes -Breaking

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© Reuters.

By Gina Lee

Investing.com – Asia Pacific stocks were down on Wednesday morning, with investors awaiting the for clues on the central bank’s interest rate hike moves.

Japan’s inched up 0.05% by 9:04 PM ET (2:04 AM GMT) while South Korea’s slid 1.32%.

In Australia, the was down 0.26% and Hong Kong’s fell 1%.

China’s fell 0.67% and the was down 0.55%, after their worst New Year debut since 2019 on Tuesday. The index of Chinese companies that trade in New York was also the worst in over two weeks.

U.S. Treasuries remained steady after yields increased for a second consecutive day in response to rising expectations that the Fed will raise interest rates at minimum three times by May 2022. After a one-year pause, yields on longer maturities increased due to the issuance of several new corporate bonds.

Investors now await the minutes from the Fed’s meeting in December, due later in the day, and the U.S. jobs report, due to be released on Friday, for clues on the Fed’s potential pace of the hikes. The Minneapolis Fed president stated that he is in favor of two rate hikes by 2022 to reduce high inflation.

“Earlier we thought that rate hikes wouldn’t be on the table until mid-2022 but the Fed seems to have worked up a consensus to taper assets faster and hike sooner rather than later,” Standard Chartered (OTC:) head of global G-10 FX research Steve Englander said in a note.

“But we don’t think inflation dynamics will support continued hiking. We suspect the biggest driver of asset markets will be when inflation and COVID-19 fears begin to ebb,” the note added.

More Fed officials will be giving comments throughout the week. On Thursday, James Bullard (St. Louis Fed President) spoke at an event and Mary Daly (San Francisco Fed President) addressed a different panel.

Investors also digested Tuesday’s U.S. data, which showed that the was a lower-than-expected 58.7 in December. In November, the survey showed that there were 10.562 millions vacancies.

According to reports, North Korea launched its first missile-launched ballistic weapon in two months. This was days after Kim Jong Eun stated that he did not believe it would be possible for the U.S. to resume nuclear negotiations in 2022.

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