A gauge of global stocks headed for the highest level in more than two months on Thursday and the dollar fell after Federal Reserve meeting minutes showed support for tapering interest-rate increases.
Read: Most Fed officials seek to slow pace of interest-rate hikes soon
Japanese, South Korean and Australian equities benchmarks advanced while Chinese gauges fluctuated. US futures climbed after the S&P 500 closed at a two-month high Wednesday before the Thanksgiving holiday.
The moves in Hong Kong and the mainland came as investors weighed the impact of record Covid-19 cases against signs of loosening monetary conditions.
Official comments broadcast Wednesday indicated the People’s Bank of China would allow banks to reduce capital reserves to stimulate growth.
China’s zero-Covid policy has had “a significant effect on consumption” while the property crisis is “affecting investment in the sector and affecting property developers,” Gita Gopinath, first deputy managing director for the International Monetary Fund, said in an interview with Bloomberg Television.
Government bond yields edged lower in Australia and New Zealand after Treasury yields fell Wednesday along with the dollar.
Read:
New Zealand rate hike signals global tightening is far from over, says HSBC
China’s iPhone City locks down urban areas as Covid cases rise
A gauge of the greenback slid further Thursday to levels not seen since August on a closing price basis. There will be no trading in Treasuries due to the US holiday.
Minutes from the Fed gathering earlier this month indicated several officials backed the need to moderate the pace of rate hikes, even as some underscored the need for a higher terminal rate.
This adds weight to expectations the central bank will raise rates by 50 basis points next month, ending a run of jumbo 75 basis point increases.
Data Wednesday also showed US business activity contracted and unemployment applications rose as the economy cools.
Oil fell as the European Union considered a higher-than-expected price cap on Russian crude and signs of a global slowdown increased.
Gold rose for a third day on the Fed minutes. The precious metal has been hurt by the US central bank’s aggressive monetary-tightening policy to curb inflation, which has pushed up bond yields and the dollar and in turn sent bullion tumbling about 16% from its March peak.
© 2022 Bloomberg
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