Asian markets mixed as traders eye US data ahead of Fed decision

02/12/2025

Summary of Asian Markets & Global Outlook

Asian stocks were mixed on Monday as investors waited for key U.S. economic data that could influence the Federal Reserve’s highly expected interest-rate cut next week. Market optimism remains strong after a late-November rebound fueled by expectations of continued Fed easing into 2026.

Why This Matters

Odds of the Fed cutting rates again on December 10 sit near 90%.
Traders are watching U.S. data this week — private payrolls, services activity, and PCE inflation — to see if the Fed will keep cutting next year.
Several Fed officials recently signaled concern about a weakening labor market, boosting expectations for further rate reductions.

Market Sentiment

Confidence is improving, and analysts say an end-of-year rally is possible. But risks remain:

Fed could skip the cut or deliver a “hawkish cut.”
U.S. Supreme Court may rule on the legality of Trump’s trade tariffs.
New jobs and inflation data could shift market expectations.

Reports that Kevin Hassett, a strong supporter of low rates, may become the next Fed Chair also lifted sentiment.

Asia-Pacific Market Performance

Gainers: Hong Kong, Shanghai, Singapore, Manila
Decliners: Sydney, Seoul, Wellington, Taipei

Tokyo fell more than 1%, pressured by a stronger yen as expectations rise that the Bank of Japan will raise interest rates in December or January.

Oil Markets

Oil prices jumped 1.4–1.5% after OPEC+ confirmed it will pause production increases through Q1 2026 due to soft seasonal demand.
Traders are also watching progress in Ukraine peace talks, which could eventually return more Russian crude to the global market.