(Bloomberg) — Asian equities fell Thursday after Federal Reserve minutes showed fresh caution on interest rate cuts and President Donald Trump called for more tariffs.
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Shares in Japan, Australia and South Korea edged lower alongside Hong Kong equity index futures. US contracts declined in a sign the S&P 500 will pare much of its Wednesday gains.
Downward pressure on Japanese equities partly reflected a stronger yen. The currency rallied for a second day against the greenback to trade around 151 per dollar. An index of the US currency was slightly lower after climbing in the prior session.
Fed minutes showed policymakers in January expressed a readiness to hold interest rates steady amid stubborn inflation and economic-policy uncertainty. Officials also revealed pausing or slowing the balance-sheet runoff — a process known as quantitative tightening, or QT, until the government’s debt-ceiling drama is resolved.
“They will sit and wait before cutting again,” said Peter Boockvar, author of The Boock Report. “I say ‘cut’ because it still seems like they have an easing bias. The Fed also commented on the balance sheet. This could also be a reason why yields dipped a bit.”
Financial markets appeared unphased by comments from President Donald Trump late on Wednesday in the US, which touched on efforts to cut government spending and further work to be done on tariffs. He also touted the Nasdaq, Dow Jones and Bitcoin gains in the last few months.
Bitcoin was a popular so-called Trump trade and soared to a record high in the months following November’s US election but has since fallen around 10% from a peak in January.
The Australian dollar rose after data showed more jobs were added to the economy than anticipated.
In Asia, data set for release Thursday includes export orders for Taiwan, inflation for Hong Kong and China one-year and five-year loan prime rates. Separate one-year medium-term lending facility data for China may be released anytime through February 25.
The latest China data will come after the country recorded the weakest start for inbound investment in four years, with just over $13 billion in new spending by foreign firms in the country in January.
Investors will also be focused on Alibaba Group Holding Ltd., which faces a key test in its earnings presentation Thursday after a DeepSeek-sparked rally added more than $110 billion to its market value.
