Asian stocks slide on inflation jitters; BOJ, Fed meetings on tap
Investing.com-- Most Asian stocks fell sharply on Friday as hotter-than-expected U.S. inflation readings spurred more concerns over higher-for-longer interest rates, with a barrage of upcoming central bank meetings coming squarely into focus.
Regional markets took a weak lead-in from Wall Street as producer price index inflation rose more than expected in February. The reading, which came on the heels of a strong consumer inflation print earlier this week, saw traders reduce their expectations for a rate cut in June.
Wall Street futures fell slightly in Asian trade, as markets grew fearful of any more hawkish signals from a Federal Reserve meeting next week.
Japan’s Nikkei 225 index fell 0.3% on Friday and was set for a 2.3% weekly decline, as investors continued to lock-in profits from record highs hit last week. The TOPIX rose 0.6%, but was set to lose nearly 2% this week.
Focus was now squarely on a Bank of Japan meeting next week, where the central bank is widely expected to signal, or even enact an end to its negative interest rates and yield curve control policies.
Bets on a BOJ pivot were spurred chiefly by signs of sticky Japanese inflation, while the results of countrywide wage negotiations pointed to substantial increases in wages this year- a trend that is also expected to underpin inflation.
Australia’s ASX 200 slid 1% amid heavy profit-taking after hitting a record high earlier in the week.
Profit-takers swept in ahead of a Reserve Bank of Australia meeting next week, where the central bank is widely expected to maintain its hawkish course as inflation remained above its 2% annual target.
Analysts at ANZ said they expected the RBA to only turn neutral on policy by May, and that the bank is likely to
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