Asia-Pacific markets traded mostly lower on Thursday after the U.S. Federal Reserve announced its third interest rate cut for the year, reducing the Federal Funds rate by 25 basis points to a range of 3.5%-3.75%. Fed Chair Jerome Powell, speaking at a press conference following the meeting, suggested that the central bank is in a stable position regarding rates. “We are well-positioned to wait and see how the economy evolves,” Powell noted, emphasizing the impact of President Donald Trump’s tariffs on inflation.
As a result of the Fed’s announcement, the U.S. dollar index fell to 98.54, marking its lowest level since October 21. Japan’s Nikkei 225 index, which started the day on a positive note, reversed course and dropped by 0.58%, while the Topix index declined by 0.52%. South Korea’s Kospi index also experienced a downturn, losing 0.56%, and the smaller Kosdaq fell by 0.36%.
In contrast, Hong Kong’s Hang Seng index managed a slight gain of 0.1%, though mainland China’s CSI 300 edged down marginally. Notably, shares of ZTE Corp, a Chinese telecommunications equipment maker, plummeted by over 5% following a Reuters report suggesting the company may need to pay over $1 billion to settle allegations of foreign bribery with the U.S. government.
Australia’s S&P/ASX 200 index hovered just below the flatline. In addition to the rate cut, the Fed announced plans to resume buying $40 billion in Treasury bills starting Friday, which further impacted short-term Treasury yields, driving them downwards.
The Fed’s statement also included a noteworthy shift; it removed language describing the labor market as having “remained low,” indicating a potential pivot in focus from inflation control to boosting economic support.
In the previous U.S. trading session, the Dow Jones Industrial Average surged by 1.1% following the Fed’s decision, with the S&P 500 rising by 0.7% and the Nasdaq Composite increasing by 0.3%. Market analysts continue to monitor global economic conditions as the Fed adopts a more cautious approach, balancing inflation concerns amidst ongoing trade tensions.
This economic landscape presents a complex backdrop for international markets, as investors weigh the implications of U.S. monetary policy against regional developments. The shifting dynamics underscore the interconnectedness of global economies, shaped by policy decisions, geopolitical events, and market reactions.
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Keywords: Federal Reserve, interest rate cut, Asia-Pacific markets, U.S. dollar index, inflation, economic support, trade tensions.
Original Source: https://www.cnbc.com/2025/12/11/asia-pacific-markets-live-thursday-fed-third-rate-cut-jerome-powell-nikkei-225-hang-seng.html
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Publish Date: 2025-12-11 09:04:00
