Fed’s Powell hints 25 bps cut may be last of 2025 BOJ expected to leave rates on hold for now
ECB also seen standing pat Trump and Xi to meet in South Korea, de-escalation expected
U.S. tech sector earnings weigh on stocks
SINGAPORE, Oct 30 (Reuters) – Asian stocks fluctuated between gains and losses early on Thursday after the Federal Reserve cut interest rates and as investors waited to see if U.S. and Chinese leaders will thrash out a trade deal.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab was last trading flat, while U.S. S&P 500 e-mini futures edged 0.1% higher after stocks on Wall Street posted a slim loss to snap a four-day winning streak.
Global markets are in the midst of a string of central bank decisions that will give clues about the path ahead for interest rates as U.S. President Trump’s administration imposes blanket tariffs on foreign imports.
Trump is due to meet Chinese leader Xi Jinping in South Korea later today. U.S. negotiators have signaled they seek a return to a fragile trade war truce, but tensions remain high and longer-term economic irritants will likely persist between the geopolitical rivals.
“After a fair bit of action in the first couple days of this week, we’ll probably finish the central banking story with a bit of a whimper in the next 24 hours, with probably not much happening either from the BOJ or the ECB,” said Sally Auld, chief economist at National Australia Bank in Sydney in a podcast.
Against the yen, the U.S. dollar was last unchanged at 152.70 yen after remarks by U.S. Treasury Secretary Scott Bessent calling for speedier rate hikes to avoid weakening the currency too much, which analysts said may affect the BOJ’s communication on the future pace of rate hikes.
The Federal Reserve cut interest rates on Wednesday by a quarter of a percentage point as expected, but the U.S. central bank’s new policy statement included several references to the lack of official data during the ongoing federal government shutdown, and Fed Chair Jerome Powell told reporters later that policymakers are likely to become more cautious if it deprives them of further job and inflation reports.
Traders have slashed their forecasts of a 25-basis-point rate cut next month, which had been viewed as a near-certainty earlier. Fed funds futures now imply a 67.8% probability that the Fed will hold rates at its next meeting on December 10, compared with a 9.1% chance yesterday, according to the CME Group’s FedWatch tool.
The yield on the U.S. 10-year Treasury bond was last trading around a three-week high of 4.0757%, up 1.77 basis points compared with a previous close of 4.058%.
The dollar index , which measures the greenback’s strength against a basket of six currencies, climbed to a two-week high of 99.131. Gold was last up 0.4% at $3,944.25 per ounce.
The euro was last unchanged at $1.16035 ahead of a policy decision by the European Central Bank later in the day at which it is expected to leave rates on hold for a third meeting in a row.
Elsewhere, corporate earnings season is fuelling fresh anxiety among investors over the cost of the AI buildout, even as the U.S. economy appears to remain in rude health, putting pressure on tech megacap stocks that account for the biggest weighting in the S&P 500 Index (.SPX), opens new tab.
