Asian markets saw mostly positive movement on Monday as investors processed the recent sharp rate cut from the US Federal Reserve, alongside monetary policy developments from regional central banks, CNBC reports.
Data released last Friday revealed that China’s youth unemployment rate increased for the second consecutive month, reaching its highest level this year, according to the National Bureau of Statistics. This rise comes as the labor market continues to cool amid a weakening economy. Despite mounting calls for interest rate reductions, the People’s Bank of China unexpectedly maintained its key benchmark rates on Friday but injected 234.6 billion yuan (approximately $33.29 billion) into the banking system through open market operations to ensure adequate liquidity at the end of the quarter. Additionally, the PBOC lowered the 14-day reverse repo rate to 1.85% from 1.95%.
In Japan, the Bank of Japan decided to keep its benchmark interest rate steady at around 0.25%. Officials are monitoring the market closely for signs of yen carry trades that could increase volatility, according to Japan’s top currency diplomat, Atsushi Mimura. Japanese markets were closed Monday for a public holiday, but futures contracts for the Nikkei 225 indicated a rise, trading at 38,375 compared to the index’s previous close of 37,723.91.
The Reserve Bank of Australia began a two-day policy meeting on Monday, with expectations that it will maintain the current benchmark interest rate at 4.35%. Analysts are particularly focused on whether the RBA will adjust its hawkish stance in light of the Fed’s recent actions.
In Singapore, inflation data for August exceeded expectations, with headline inflation rising 2.2% and core inflation increasing 2.7% year on year. These figures were higher than the forecasts of 2.15% and 2.6%, respectively.
In terms of market performance, Australia’s S&P/ASX 200 fell 0.69% to close at 8,152.9. Conversely, South Korea’s Kospi gained 0.33% to finish at 2,602.01, and the small-cap Kosdaq rose 0.91% to close at 755.12. Hong Kong’s Hang Seng index saw a slight decline of 0.2%, while mainland China’s CSI 300 index increased by 0.37% to end at 3,212.76. The Taiwan Weighted Index also saw a modest rise of 0.57%, closing at 22,285.53.
In the US, the three major stock indices experienced weekly gains, with the Dow Jones Industrial Average closing at a record high of 42,063.36, up 0.09% on the day. The S&P 500 and Nasdaq Composite registered slight declines, finishing at 5,702.55 and 17,948.32, respectively.
