Asian shares start week lower, tracking Wall St retreat
BANGKOK (AP) — Asian shares opened mostly lower on Monday after a retreat on Wall Street spurred by disappointing economic data and corporate earnings. Oil prices also slipped.
Investors are awaiting the next move by the U.S. Federal Reserve, which is expected to raise its key interest rate again on Wednesday as it strives to beat back inflation.
The Fed will likely announce its second 0.75% point increase in its short-term rate in a row, a hefty increase that it hasn’t otherwise implemented since 1994. That will put the Fed’s benchmark rate in a range of 2.25% to 2.5%, the highest level since 2018.
The U.S. economy is slowing but healthy hiring shows it is not yet in recession, Treasury Secretary Janet Yellen said Sunday on NBC’s “Meet the Press.” She spoke ahead of the release this week of a slew of economic reports that will shed light on an economy currently besieged by rampant inflation as interest rates rise.
The highest-profile report will likely be Thursday, when the Commerce Department will release its first estimate of the economy’s output in the April-June quarter.
Some economists forecast it may show a contraction for the second quarter in a row. The economy shrank 1.6% in the January-March quarter. Two straight negative readings is considered an informal definition of a recession, though in this case economists think that’s misleading.
Similar data from Europe have underscored the weakness of the global economy as central banks jack up interest rates. Higher rates make economic conditions more difficult, and too-aggressive hikes could cause a recession.
“While rising jobless claims, softer home sales, and a buildup in gasoline inventory show the Fed front-loading rate hikes are causing a slowdown and bringing inflation under control, the issue is at what...