Asian Markets Extend Gains As Fed Hopes Linger 12 July 2019
Asian equities rose Friday, building on optimism fuelled by expectations of a Federal Reserve interest rate cut, with debate now focusing on how far the central bank will go
Hong Kong, (UrduPoint / Pakistan Point News - 12th Jul, 2019 ):Asian equities rose Friday, building on optimism fuelled by expectations of a Federal Reserve interest rate cut, with debate now focusing on how far the central bank will go.
The gains came despite unease caused by Donald Trump accusing China of backsliding on a trade promise -- just days after the two sides tentatively began phone talks on resolving their tariffs war.
After big losses at the start of the week, trading floors have been much more positive since Federal Reserve boss Jerome Powell's congressional testimony Wednesday in which he all but flicked the switch on a rate cut at the end of the month.
A second day of testimony Thursday essentially reiterated his point.
His comments, which highlighted economic headwinds from the trade war and slowing global growth, sparked a rally on world markets.
"We have a sitting (policy board) that is prepared to over-deliver on markets' expectations as... Powell's monetary policy testimony unambiguously reinforces his inclination to cut rates aggressively," said Vanguard Markets' Stephen Innes.
He added that even a forecast-beating inflation report on Thursday was unable to deter traders from betting on a reduction.
"Not surprisingly there is 100 percent consensus the Fed is going to cut in July. But we are still no closer to settling the 25 or 50 (basis points) July rate cut debate."