Asia stocks slide as rate cut bets sour.
Most Asian stocks fell on Friday as markets priced out expectations for a U.S. interest rate cut in December, with technology shares leading losses as they tracked overnight declines on Wall Street.
Middling Chinese economic data added to pressure on Asian markets, as the region’s largest economy struggled to break out a years-long economic downturn.
Regional markets took a weak lead-in from Wall Street, which tumbled overnight as tech shares saw renewed selling on concerns over artificial intelligence-fueled valuations.
Broader sectors also sank as markets rapidly priced out expectations for a December interest rate cut by the Federal Reserve. Investors are pricing in a 45.8% chance for a 25 basis point cut and a 54.2% chance for a hold, CME Fedwatch showed.
S&P 500 Futures rose 0.2% as markets attempted to recoup some recent losses. Reports of more U.S. trade tariff exemptions offered some support.
Dollar poised for weekly loss.
The dollar headed for a weekly fall on Friday as investors trimmed positions while waiting to assess a backlog of U.S. data following the government’s reopening.
Traders sold the greenback despite higher yields and expectations for a Federal Reserve rate cut next month receding. The move came alongside a selloff in U.S. equities and bonds, which spilled over into Asian share markets on Friday.
“There’s a whiff of ’sell America’ back in the air,” said Ray Attrill, head of FX research at National Australia Bank (NAB).
More Fed officials signalled caution over further easing overnight, citing worries about inflation and signs of relative stability in the labour market.
However, a slightly more hawkish Fed tone failed to lift the dollar, which fell to a two-week low against the euro in the previous session. The common currency bounced back above the $1.16 mark and traded 0.1% higher at $1.1644.
The Swiss franc similarly held near an over three-week high and steadied at 0.7919 per dollar. Against a basket of currencies, the greenback languished near a two-week low at 99.14.
US to remove tariffs on some products.
The United States said on Thursday it will remove tariffs on some foods and other imports from Argentina, Ecuador, Guatemala and El Salvador under framework agreements that will give U.S. firms greater access to those markets.
The agreements are expected to help lower prices for coffee, bananas and other foodstuffs, a senior Trump administration official told reporters, adding the administration expected U.S. retailers to pass on the positive effects to American consumers.
The framework deals with most of the four countries should be finalized within the next two weeks, the official said, with additional agreements seen as possible before the end of the year.
U.S. Treasury Secretary Scott Bessent on Wednesday said the U.S. planned some “substantial” announcements in coming days that would lead to lower prices on coffee, bananas and other fruits, as part of a push by the Trump administration to drive down the cost of living for Americans.
Secretary of State Marco Rubio and Brazil’s Foreign Minister Mauro Vieira discussed a framework for a U.S.-Brazil trade relationship in a meeting this week, the U.S. State Department said on Thursday.
Brazil is the world’s largest coffee producer and exporter but its exports to the U.S. face crushing 50% duties imposed by U.S. President Donald Trump.
Trump has focused intensely on the issue of affordability after a string of defeats for Republican candidates in last week’s elections, while insisting that any higher costs were triggered by policies enacted by former President Joe Biden, and not his own sweeping tariffs.
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