Asian exchanges are on the defensive Friday.
Investors are uncertain after the US central bank governor Janet Yellen went on the podium at the University of Massachusetts to talk about inflation and monetary policy.
Only a week after the central bank surprised the market and spurred deflation fears, there was additional focus on what Yellen had to say about just inflation.
This said Yellen
And what she said was that an interest rate increase “sometime later this year” will probably be appropriate.
Yellen stressed however that the decision will depend on the macro figures, and that the timing of the first rate increase is less important than that it should be done gradually in several steps.
Federal Reserve boss did not begin to speak until after closing, but the mood on Wall Street was still nervous on Thursday.
The dollar has reacted to the speech to strengthen against a basket of currencies. EURUSD is now in 1.1168, compared to around 1.1230 when Yellen went on.
– Our view of a rate hike in December have not changed. We recognize that China turmoil and the strong dollar makes investors cautious, but macro figures continue to point toward a broad recovery in the US economy.
– Without any big numbers drop and events, can the Fed’s monetary policy outlook will be key driver for markets Today, writes analyst Cynthia Jane Kalasopatan in Singapore Mizuho Bank according to CNBC in a note.
Nikkei up, rest down
Hang Seng in Hong Kong falling 0.2 percent, while the Shanghai Composite index pulls down 1.6 percent.
Elsewhere in Asia-Pacific region goes Kospi index in South Korea and Sydney stock exchange both back around 0.2 percent.
Tokyo Stock Exchange is the large, positive exception.
Nikkei ended up 1.8 percent to 17,780.51, while the broader Topix index rose 1.9 percent to 1,453.81 .
Asia-section here.
– Japan must do more
Turn is in Japan came after a meeting between Governor Haruhiko Kuroda and Prime Minister Shinzo To ask.
Abe said according to CNBC early Friday that he has set three new targets for “Abenomics” and aiming for a 20 percent increase in GDP in that of someone called “Abenomics 2.0″.
The three new objectives are therefore strong economic growth, an increase in birth rates, as well as measures to strengthen health care for the elderly.
– The authorities are concerned that they are losing momentum, and try to restore confidence in the medium term, despite how the economy evolves in the short term, says global chief strategist for G10 currency in Citibank, Steven Englander, to the channel.
And macroeconomic figures released Friday showed that consumer prices in August fell for the first time since April 2013, namely by 0.1 percent from July.
– The figures suggest that the central bank may need to do more, writes IGS Singapore-based strategist Bernard Aw in a note Friday.
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