Asian Stock Market: Mixed on positive DXY, RBI raises repo rate by 50 bps, China Inflation eyed
08.06.2022, 04:51

Asian Stock Market: Mixed on positive DXY, RBI raises repo rate by 50 bps, China Inflation eyed

  • A positive DXY has offset the optimism of bullish US indices.
  • The RBI has elevated its repo rate by 50 bps to 4.90%, inflation is seen stable at above 6%.
  • Chinese equities are subdued as investors await China's CPI.

Markets in the Asian domain are trading mixed amid different respective fundamentals. A recovery in Wall Street on Tuesday was expected to infuse optimism in the Asian equities, however, the positive US dollar index (DXY) on Wednesday is guiding the risk-sensitive assets.

At the press time, Japan’s Nikkei225 added 0.92% and Hang Seng gained 1.73% while China A50 is trading flat and Nifty50 eased 0.46%.

Chinese equities are trading flat on Wednesday as investors are awaiting the release of China’s Consumer Price Index (CPI), which is due on Friday. China CPI is seen higher at 2.5% against the prior print of 2.1%. A higher print of China inflation will restrict the People’s Bank of China (PBOC) to flush more liquidity into the economy. This may dampen the growth forecasts and will bring shrinkage into the economy.

Indian indices are displaying wild moves as the Reserve Bank of India (RBI) has elevated its repo rate by 50 basis points (bps). A rate hike announcement by the RBI was already anticipated by the market participants as the Indian economy is facing the headwinds of soaring oil and commodity prices. Officially, the RBI’s repo rate stands at 4.90% after the rate hike announcement. The RBI is expecting sustainability of inflation above 6% for the first three quarters of Calendar Year (CY) 2022.

 

 

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