Fed’s Jerome Powell hints at 50 basis point hike for May


SINGAPORE — Shares in Asia-Pacific looked set for a lower start Friday as investors watch for market reaction to overnight remarks from U.S. Federal Reserve Chairman Jerome Powell.

Futures pointed to a lower open for Japanese stocks. The Nikkei futures contract in Chicago was at 27,100 while its counterpart in Osaka was at 27,130. That compared against the Nikkei 225’s last close at 27,553.06.

Australian stocks also looked poised to open in negative territory, with the SPI futures contract at 7,497, against the S&P/ASX 200’s last close at 7,592.80.

Fed watch

Powell hinted at more aggressive rate hikes ahead by the central bank as it seeks to bring down inflation. He said the Fed is committed to hiking rates “expeditiously” to tame inflation.

“I would say 50 basis points will be on the table for the May meeting,” Powell said. Following those comments, expectations for a 50 basis point move in May rose to 97.6%, according to the CME Group’s FedWatch Tool.

Stock picks and investing trends from CNBC Pro:

U.S. Treasury yields also jumped on the back of Powell’s comments. The yield on the benchmark 10-year Treasury note, which started the year near 1.5%, last stood at 2.9095%.

Stocks on Wall Street fell overnight stateside, with the S&P 500 slipping about 1.48% to 4,393.66. The Dow Jones Industrial Average shed 368.03 points, or 1.05%, to 34,792.76. The tech-heavy Nasdaq Composite lagged, dropping 2.07% to 13,174.65.


The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 100.578 — once again above the 100 level that it fell below briefly earlier this week.

The Japanese yen traded at 128.36 per dollar, still weaker as compared with levels below 126 seen last week against the greenback. The Australian dollar was at $0.7364 after a recent drop from above $0.744.

— CNBC’s Jeff Cox contributed to this report.


Please enter your comment!
Please enter your name here