On Thursday, Asian stocks rose after the Federal Reserve conveyed a widely-expected benchmark interest rate hike by a quarter point, and maintained its outlook for three additional rate hikes next year, even as it flagged caution over low inflation.
“The key takeaway from the Fed meeting was the degree of concern shown towards low inflation, which is likely led to two dissenting votes,” a senior forex strategist said.
“The 10-year treasury yield fell sharply on the Fed’s stance and lackluster US CPI (Consumer Price Index), which shows that the markets don’t necessarily see the Fed hiking rates three times in 2018.”
The 10-year treasury yield edged a little higher at 2.3547 percent after plummeting about six basis points overnight.
China’s central bank also slightly increased rates. Even though Chinese shares were slightly down, the broad effect was limited.
According to the data earlier on Wednesday, it showed U.S. core consumer products, excluding volatile energy and food prices, weakened to 0.1 percent in November from a 0.2 percent rise in October.
The dollar index, which gauges the strength of the greenback against the trade-weighted basket of six major currencies, dropped slightly to 63.353 after falling about 0.7 percent on Wednesday to keep away from a one-month top of 94.219 set on Tuesday.
MSCI’s broadest index of Asia-Pacific shares, which is supported by the Fed’s less aggressive statements, climbed 0.45 percent.
Shares of Shanghai and the Chinese yuan were slightly down after the People’s Bank of China raised the reverse repo rate by five basis points to 2.50 percent and increased the one-year medium-term lending facility (MLF) rate by five basis points to 3.25 percent.
Australian stocks gained 0.1 percent and South Korea’s Kospi added 0.8 percent.
Japan’s Nikkei lost 0.15 percent, affected by the weaker dollar.
The dollar slightly changed at 112.620 yen after losing 0.9 percent overnight, while the euro gained 0.15 percent to $1.1841 following gains of 0.7 percent the previous day.
The pound was flat at $1.3423.
In commodities, U.S. crude futures jumped 0.3 percent to $56.78, supported by the weaker dollar.
Oil prices had dropped for a second consecutive day on Wednesday, as a fall in U.S. crude supplies was counterbalanced by a larger than the estimated increase in petrol inventories and as U.S. crude production continued to grow to record highs.
Spot gold increased 0.15 percent to $1,257.10 ounce.
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