Stocks decline as China refrains from cutting interest rate

Stocks decline as China refrains from cutting interest rate

Stocks















Bloomberg

Stocks fall in Asia Friday as China unexpectedly opted against cutting a key policy interest rate, a reduction that had been widely expected to support an economy hamstrung by Covid-19 lockdowns.

Equities were mixed on the mainland and fell in Japan and South Korea, among the few markets open amid Easter holidays. China has indicated it will reduce the reserve requirement ratio for banks soon, which may have made a cut in the rate on one-year policy loans less urgent.

The Asian weakness followed a technology-led retreat in US shares as worries about faster inflation and aggressive Federal Reserve tightening flared anew.

Treasuries also slid, hurt by higher US import prices and comments from Federal Reserve official John Williams that a half-percentage point rate hike is a “reasonable option.” Treasury markets are shut for Good Friday. The dollar rose against all its Group-of-10 peers, with the yen struggling.

Oil’s biggest weekly rally this month underlined global price pressures. Crude was bolstered by a report saying the European Union is moving towards adopting a phased ban on imports from Russia due to the war in Ukraine.

The rise in bond yields