Asian Markets Set to Fall After Wall St Records Worst Week of 2023; Bank of Japan Governor to Address Japan’s Upper House

Fri Feb 24 2023 8:36 AM EST

Fed Mester Says Rates Need to Above 5% to Stifle Inflation

Interest rates need to rise further for inflation to come down, Cleveland Federal Reserve Chair Loretta Mester said Friday.

“I see we’re going to have to take interest rates above 5%,” she told CNBC’s Steve Liesman during a “Squawk Box” interview. “We will determine how much above. It will depend on how the economy develops over time. But I think we need to be a little above 5% and stay there for a while in order to bring the inflation on a sustainable downward path to 2%.

Mester recently made headlines when she revealed that she was part of a small group of Fed officials who, from January 31 to February 31. 1 Federal Open Market Committee, wanted a half-percentage-point rate hike rather than the panel-approved quarter-point move.

—Jeff Cox

59 minutes ago

China Renaissance says Bao Fan is cooperating with government investigation

Missing Chinese investment banker Bao Fan is cooperating with a government investigation, his company China Renaissance said in a filing on Sunday.

“The board has learned that Mr. Bao is currently cooperating with an investigation by certain authorities in the People’s Republic of China,” the company said, noting that his business operations remained normal.

Shares of Hong Kong-listed China Renaissance have plunged 29% since the company said on Feb. 16 that it was unable to reach Bao. He is, among other things, majority shareholder, chairman and CEO and founder of the company.

— Evelyn Cheng

An hour ago

Asian Week Ahead: Growth, Inflation, and PMI Readings

Regional readings for the Purchasing Managers Index, Japan’s Industrial Production and Australia’s Gross Domestic Product will be some of the major economic events taking place this week.

New Zealand is expected to release its fourth-quarter retail sales on Monday, while Taiwan will observe Peace Memorial Day until Tuesday.

On Tuesday, Japan is expected to release its industrial production and retail sales while Australia will announce its current account for the fourth quarter.

India will also release its gross domestic product for its fourth quarter on Tuesday. Overnight, US Consumer Confidence for February will also be released.

The South Korean market will be closed on March 1 to observe the Independence Movement Day.

On Wednesday, China’s National Bureau of Statistics will release its government reading of the Purchasing Managers’ Index after showing a return to growth of 50.1 in January.

Australia will release its inflation reading and gross domestic product for the fourth quarter. Economists polled by Reuters expect seasonally adjusted growth of 2.8% on an annualized basis.

Indonesia will also announce its February consumer price index, which is expected to rise to 5.42% from a previous reading of 5.28%, according to a Reuters poll.

On Thursday, New Zealand’s fourth-quarter trade data will be released along with South Korea’s industrial production and retail sales. The S&P Global Manufacturing PMI for South Korea is also expected to be released.

On Friday, Japan’s unemployment rate for January is expected to reach 2.5% for January, according to a Reuters poll. Tokyo’s consumer price index for all items except fresh food is expected to have risen 3.3% in January.

—Jihye Lee

Fri Feb 24 2023 3:16 PM EST

Investors must ‘control what they can control,’ says Baird

The market is currently feeling the effects of “too much good news at once”, according to Baird analyst Ross Mayfield. With inflation still high and the Federal Reserve expected to continue with rate hikes, Mayfield advises investors to “control what they can control.”

“First, automate things: dollar cost averaging (investing on regular intervals) is a great way to find outperformance in volatile/sideways markets,” Mayfield wrote in a Friday note.

“Second, re-examine your allocation to make sure you’re well-diversified and on plan.”

—Hakyung Kim

Fri Feb 24 2023 4:05 PM EST

Stocks wrap up worst week of the year

US stocks ended lower on Friday, wrapping up their worst week of 2023.

The Dow Jones Industrial Average fell 336 points, or 1.0%. The S&P 500 and the Nasdaq Composite fell 1.0% and 1.7% respectively. The Dow Jones fell 510 points, or 1.54%, earlier in the trading session.

—Hakyung Kim

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