MSCI's broadest index of Asia-Pacific shares outside Japan eases 1% amid cautious mood
Sydney — Asian shares slipped on Monday before a week packed with central bank meetings and US inflation data, while the euro eked out a gain on relief the far right did not win the first round of the French presidential elections.
The mood in equity markets was cautious, with MSCI's broadest index of Asia-Pacific shares outside Japan easing 1.0%.S&P 500 stock futures eased 0.4% and Nasdaq futures 0.6%. Euro Stoxx 50 futures lost 0.4%, and FTSE futures 0.3%. Markets have raced to price in the risk of ever-larger rate hikes from the Federal Reserve with futures implying rises of 50 basis points at both the May and June meetings.BofA's US economist Ethan Harris now expects half-point hikes at each of the next three meetings and a cycle peak about 3.25-3.50%.
China's inflation figures surprised on the high side on Monday and while relatively modest at 1.5% year on year in March, still dented hopes for aggressive policy easing from Beijing. Continuing the tightening theme, central banks in Canada and New Zealand could well raise rates by 50 basis points at their policy meetings this week.The outsize rise in Treasury yields has seen the dollar index top 100 for the first time since May 2020, and it was last trading at 99.858.