The Bank of Japan (BOJ) headquarters in Tokyo, Japan, on Thursday, Oct. 31, 2024. The Bank of Japan kept its benchmark interest rate unchanged.
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Asia-Pacific markets dipped on Thursday, tracking losses on Wall Street that saw the Dow Jones Industrial Average touch a new closing low for the year.
The Federal Reserve held its key policy rate steady at 3.5% to 3.75%, with Chair Jerome Powell watering down rate-cut expectations, saying that inflation was not coming down as much as ‘hoped.’
The producer price index — which tracks the change in wholesale prices — rose 0.7% in February, well above the 0.3% that economists polled by Dow Jones had estimated.
Despite that, the U.S. central bank’s “dot plot” still projects a cut in 2026 and another in 2027, even though the timing is unclear.
The Iran war continues to fuel energy worries. International benchmark Brent crude futures rose 3.83% to settle at $107.38 per barrel.
U.S. oil prices were trading at elevated levels as well, with West Texas Intermediate futures closing marginally higher at $96.32 per barrel.
Investors in Asia will look toward the Bank of Japan decision, with the bank expected to hold rates at 0.75%.
South Korea’s Kospi lost 2.54%, after being the top gainer in the region on Wednesday, while the small-cap Kosdaq saw a smaller loss of 1.69%.
Chip heavyweights Samsung Electronics and SK Hynix saw losses of over 3%.
The South Korean won briefly broke past the 1,500 mark against the dollar earlier in the session, prompting finance minister Koo Yun-cheol to say on Wednesday that authorities have a “heightened sense of vigilance toward the foreign exchange market,” according to South Korean media.
Japan’s Nikkei 225 was down 2.58%, leading losses in Asia, while the broad-based Topix was 2.03% lower.
Australia’s S&P/ASX 200 was down 1.56%.
Hong Kong’s Hang Seng index fell 1.62%, while the mainland Chinese CSI 300 index was 0.89% down.
Overnight in the U.S., the 30-stock Dow lost 1.63%, ending at 46,225.15, reaching a new low this year. The index also closed below its 200-day moving average.
The S&P 500 fell 1.36%, while the Nasdaq Composite dropped 1.46%.
—CNBC’s Sean Conlon, Pia Singh and Jeff Cox contributed to this report.