Title: Asian shares edge up from near two-year lows as U.S. inflation data looms

May 11, 2022 01:46AM ET

By: AnalysisWatch

Asian shares rose on Wednesday from near two-year lows in the previous session, while the dollar remained steady in anticipation of expected US inflation data, which will give an indication of how aggressively the Federal Reserve will raise interest rates.

The broader MSCI Asia-Pacific stock index without Japan rose 0.8 per cent after falling to its lowest level since July 2020 a day earlier. Japan's Nikkei index rose 0.3%.

European markets will also open higher, with EUROSTOXX 50 index futures up 0.7%. Nasdaq index futures rose 0.8% and S&P 500 index futures rose 0.4%.

Chinese blue-chips led the Asian gains, rising 2 per cent, helped by Shanghai officials who said half the city had reached "zero COVID" status and US President Joe Biden's announcement that he was considering lifting Trump's tariffs on China as a way to lower US commodity prices.

Chinese data released earlier on Wednesday showed consumer prices rose 2.1 per cent from a year earlier, exceeding expectations and the fastest pace in five months, thanks in part to higher food prices.

US consumer price data due out at 1230 GMT could give an indication of whether the Fed will raise interest rates even more aggressively to fight inflation.

Last week, the Fed raised its one-day lending target between banks by half a percentage point, and Chairman Jerome Powell said two more such hikes are likely at upcoming US central bank meetings.

US treasuries were also quiet ahead of the data release. The yield on the benchmark 10-year bond was little changed at 2.9774% after retreating from a three-year high on Monday.

Bitcoin traded around $31,700 after a slight rebound after falling below $30,000 on Tuesday for the first time since July 2021.

US crude rose 2.36 per cent to $102.08 a barrel after falling below $100 for the first time this month on Tuesday. Brent crude rose 2.34 per cent to $104.85.