(Bloomberg) — Asian stocks rose and currencies edged higher as traders digested a rate pause by the Federal Reserve and shifted focus to a pair of central bank speeches taking place in the region.
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Shares in Japan moved up after an earlier decline, helping the MSCI Asia Pacific Index gain around 0.2%. Liquidity remains thin, with many of the region’s major equity markets — including those in Hong Kong, mainland China and South Korea — closed for the Lunar New Year holiday.
Investors in the region had plenty to digest from US trading hours — but none of it pointed to a clear direction for stocks. The Fed’s decision to hold rates was widely expected, and earnings from International Business Machines Corp., Meta Platforms Inc., Microsoft Corp. and Tesla Inc. sent mixed signals to investors.
That left traders looking for local events, with an afternoon speech by Bank of Japan Deputy Governor Ryozo Himino coming into focus. The Bank of Japan hiked rates last week, and traders think the Fed’s signal that it is in no rush to cut could give him room to strike a more hawkish tone.
“Given that markets are not pricing in a very near term hike, the yen will likely richen quickly if Himino sounds surprisingly hawkish on Japan’s economy and inflation,” said Shoki Omori, chief global desk strategist at Mizuho Securities Co. in Tokyo.
The yen gained as much as 0.5% against the dollar as fast money traders lined up bets on the currency, according to an Asia-based FX trader. That was part of a wider appreciation among Asian currencies, with a Bloomberg gauge rising as much as 0.2%.
Reserve Bank of Australia Assistant Governor for the Financial System Brad Jones will also speak Thursday after soft fourth quarter inflation data was released this week. While traders increased the odds the central bank will begin its rate cut cycle next month, markets are yet to fully price a 25 basis point reduction, according to swaps data compiled by Bloomberg.
SoftBank Shares Down
SoftBank Group Corp.’s shares fell as much as 2% before paring around half of their losses, after a Financial Times report that the company is considering a $25 billion investment in OpenAI. The two companies are leading the Project Stargate joint venture, with plans to deploy $100 billion for the construction of data centers and other AI infrastructure
