Asian Shares Retreat Before Fed Rate Decision

(RTTNews) - Asian stocks declined on Wednesday as investors parsed mixed inflation data from China and awaited the Federal Reserve's interest rate decision later in the day.

The Fed's final meeting of the year may deliver another rate cut, but the focus will be on the final Summary of Economic Projections (SEP) for 2025, which includes forecasts from Fed officials on economic growth, inflation, and interest rates for the coming years.

Fed Chair Jerome Powell's remarks to the press after the rate announcement will be watched closely for additional clues on the outlook for 2026.

The dollar was a tad lower in Asian trade and gold was little changed above $4,200 an ounce while oil edged up slightly after slipping nearly 1 percent in the previous session.

China's Shanghai Composite index slipped 0.23 percent to 3,900.50 after the release of mixed inflation data, with consumer price inflation accelerating in November while factory deflation worsened.

The consumer price index rose 0.7 percent on a yearly basis in November, matching expectations and faster than the 0.2 percent increase in October.

Producer prices declined 2.2 percent from a year ago in the month, remaining negative for 38 consecutive months.

Hong Kong's Hang Seng index finished 0.42 percent higher at 25,540.78, snapping a two-day decline after the Trump administration allowed Nvidia to sell advanced artificial intelligence chips to China.

However, reports suggested that Beijing is poised to impose restrictions on Nvidia's cutting-edge H200 chips and is aiming to push self-sufficiency in achieving its tech goals.

Japanese markets ended on a flat note ahead of the Fed and Bank of Japan policy meetings. The yen was fragile despite hawkish BOJ signals.

Bank of Japan Governor Kazuo Ueda said the central bank is getting closer to attaining its inflation target, fueling market expectations of an interest-rate rise at next week's meeting.

The Nikkei average slipped 0.10 percent to 50,602.80 while the broader Topix index settled 0.12 percent higher at 3,389.02.

Honda Motor jumped 3.3 percent and Toyota Motor added 1.6 percent on hopes that a weaker yen could boost their overseas earnings.

Seoul stocks ended a tad lower as investors awaited the FOMC outcome. The Kospi average dipped 0.21 percent to 4,135, with defense stocks falling amid signs of progress in peace negotiations in the Ukraine-Russia war.

Australian markets fluctuated before ending marginally lower, a day after the country's central bank ruled out further policy easing.

Financials, real estate and technology stocks fell while miners gained ground, helping limit overall losses in the broader market.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index fell 0.62 percent to 13,371.06, extending losses from the previous session and hitting a three-week low.

Overnight, U.S. stocks fluctuated before closing narrowly mixed as the JOLTs survey showed a recovery in vacancies for September and October, and the ADP report revealed that private payrolls increased by 4,750 on average per week in the four weeks ending on November 22, rekindling debate over the path of Federal Reserve interest-rate cuts.

The tech-heavy Nasdaq Composite inched up 0.1 percent while the S&P 500 finished marginally lower and the Dow dipped 0.4 percent.