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Asian shares mixed in light ‘Golden Week’ trading


ASIAN shares were mixed in light of “Golden Week” trading Tuesday, May 3, 2022, with markets in China, Japan and some other countries closed for holidays.

Investors are watching to see what the US Federal Reserve does as it accelerate­s efforts to curb inflation. The central bank is expected to raise short-term interest rates by double the usual amount when it releases its latest statement on Wednesday. It has already raised its key overnight rate once, for the first time since 2018, and Wall Street is expecting several big hikes in the coming months.

That will make it more costly to borrow — for a car, a home, a credit card purchase and may weaken the economy. It also would draw investment­s out of stocks into other assets as their yields rise. Ultra-low interest rates helped drive stocks to unpreceden­ted highs during the pandemic and now that process is being reversed.

Central banks in many other countries are also raising rates to try to bring price increases under control.

The Reserve Bank of Australia was due to decide on a rate hike. New Zealand has begun raising rates, as have some other central banks in the region apart from Japan and China, where economic recoveries have been slowed by efforts to tame recent outbreaks of coronaviru­s.

“For the session ahead, traders will be working on positionin­g ahead of the FOMC (Fed) and watching the RBA Meeting, where much firmer-than-expected . . . consumer price index data in Australia may have pitched the scales towards a rate hike,” Anderson Alves of ActivTrade­s said in a commentary.

Australia’s S&P/ASX 200 was nearly unchanged at 7,348.40.

Hong Kong’s Hang Seng rose 0.1 percent to 21,114.25 and the Kospi in South Korea rose 0.2 percent to 2,693.38.

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