Asian equities climbed on Wednesday, recovering from sharp earlier losses, after Federal Reserve Chair Jerome Powell signaled a more dovish stance and hinted at the possibility of rate cuts later this year.
Powell acknowledged ongoing economic resilience in the United States but pointed to signs of cooling in the labor market. He added that the Fed is considering ending its balance sheet reduction program, helping push U.S. Treasury yields lower and the dollar weaker — a supportive backdrop for Asian risk assets.
Analysts at MUFG noted that Powell’s remarks reinforced expectations for two more rate cuts this year, suggesting monetary policy may soon shift toward a more neutral stance.
Market performance:
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Japan’s Nikkei 225 surged 1.4%, rebounding from a 3% slump on Tuesday
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The TOPIX Index gained 1.3%
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South Korea’s KOSPI rose 1.7%, driven by strength in tech stocks
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Australia’s ASX 200 climbed 0.9%
Still, persistent U.S.–China trade tensions limited broader upside, keeping sentiment cautious despite the more supportive monetary outlook.