TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular
Top Results
No results found
Popular
Top Results
No results found
Asian markets fluctuate with nervous eye on US jobs data
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
People pass by an electronic board showing the numbers on the Tokyo Stock Exchange, along a street in Tokyo on March 8, 2023. (AFP/Richard A. Brooks )
A
sian traders shifted cautiously Thursday ahead of key US jobs data at the end of the week, after Federal Reserve boss Jerome Powell warned it could ramp up its pace of interest rate hikes if the economy shows no sign of slowing.
Markets have been falling since the start of February as a string of forecast-beating indicators have shattered hopes the US central bank could pause its tightening campaign soon, and even cut borrowing costs by the year's end.
And on Tuesday, Powell delivered another blow by telling lawmakers that with inflation still stubbornly high and the jobs market tight, officials were prepared to hike by half a percentage point at their next meeting as they struggle to control prices.
That would be twice the last increase, which followed a period of bumper increases last year.
The prospect of rates going ever higher -- with some predicting six percent from the current 4.5-4.75 percent -- has ramped up fears the world's top economy could tip into recession. Analysts pointed out that bond markets suggest a contraction is on the cards.
He reiterated monetary policymakers' determination to quell inflation on Wednesday in a second day of testimony to US lawmakers, though he did say the decision would be driven by data, with a close eye on the labor market.
"If -- and I stress that no decision has been made on this -- but if the totality of the data were to indicate that faster tightening is warranted, we'd be prepared to increase the pace of rate hikes," he said.
"Inflation is coming down but it's very high," he added. "Some part of the high inflation that we are experiencing is very likely related to a very tight labor market."
Meanwhile, the Fed's "beige book" survey of economic conditions said "inflationary pressures remained widespread" and that "labor market conditions remained solid".
Traders are now awaiting Friday's non-farm payrolls figures for February, with a strong reading likely to put pressure on the Fed to hike by 50 basis points.
In a worrying sign for risk appetite, a report on the private sector showed a bigger-than-expected jump in jobs last month -- double January's number -- while wage growth remained solid.
After a tepid day on Wall Street, Asian markets swung.
Hong Kong was flat while Shanghai fell with Singapore, Seoul, Wellington and Manila. Tokyo, Sydney, Taipei and Jakarta rose.
Growing concerns about rising rates causing a possible recession were keeping downward pressure on oil prices, which extended Wednesday's losses in Asian business.
"Crude prices can't shake off fears that the Fed is going to send the US economy into a bad recession," said OANDA's Edward Moya, adding that data showing a small dip in US stockpiles was unable to shake off the unease.
"The amount of crude demand uncertainty over the short-term is keeping oil prices heavy. WTI crude looks like it will be stuck between the mid-$70s and the low $80s until we have a better idea on what type of recession the Fed will trigger," he said.
