21st September Wednesday 2022: Asian markets lower preceding Fed announcement

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Global Markets:

  • Asian Stock Markets : Nikkei down 1.24%, Shanghai Composite down 0.47%, Hang Seng down 1.59%, ASX down 1.54%
  • Commodities : Gold at $1670.45 (-0.04%), Silver at $19.29 (+0.57%), Brent Oil at $90.77 (+0.17%), WTI Oil at $84.02 (+0.10%)
  • Rates : US 10-year yield at 3.557, UK 10-year yield at 3.314, Germany 10-year yield at 1.928

News & Data:

  • (CAD) Trimmed CPI y/y 5.20% vs 5.50% expected
  • (CAD) Median CPI y/y 4.80% vs 5.10% expected
  • (CAD) Common CPI y/y 5.70% vs 5.60% expected
  • (CAD) CPI m/m -0.30% vs -0.10% expected

Markets Update:

Asian stock markets are mostly lower on Wednesday, following the broadly negative cues from global markets overnight, ahead of the US Fed’s interest rate decision as well as the anticipated hawkish accompanying statement by Fed Chair Jerome Powell later in the day. The Fed is widely expected to raise interest rates by another 75 basis points, although some see an outside chance for a 100-point rate hike after hotter-than-expected U.S. inflation data last week.

The Japanese stock market is sharply lower on Wednesday, giving up all the gains in the previous session, following the broadly negative cues from global markets overnight. The Australian stock market is sharply lower on Wednesday, with the benchmark S&P/ASX 200 falling below the 6,800 level, with traders cautiously awaiting the US Fed’s rate decision and anticipated hawkish comments from Fed Chair Jerome Powell later in the day. China’s bluechip Shanghai Shenzhen CSI 300 index fell nearly 1%, while the Shanghai Composite index lost 0.5% after the European Chamber of Commerce, a top industry group, raised concerns over the country’s viability as an investment destination in the face of continued COVID-related disruptions.

The U.S. dollar index, which measures the currency against six major peers, edged a little higher to 110.22, grinding back toward this month’s 20-year high of 110.79. Meanwhile, crude oil continued its decline amid worries that aggressive tightening by the Fed and other central banks would crimp growth and curb demand.

Upcoming Events:

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  • 06:00 PM GMT – (USD) FOMC Statement
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  • 06:30 PM GMT – (USD) FOMC Press Conference