# Asia stocks track US decline following hotter-than-expected US inflation data

- Link: https://www.thailand-business-news.com/markets/126354-asia-stocks-track-us-decline-following-hotter-than-expected-us-inflation-data
- Published: 2024-02-14T09:53:17+07:00
- Author: Daniel Lorenzzo

Asian stock markets fell following the release of higher-than-expected US inflation
data, leading to a drop in US stocks.

 * The hotter-than-expected US inflation data led to a drop in Asian stocks and 
   a warning from Japan about rapid movements in the foreign-exchange market.
 * The consumer price index report caught investors off guard, impacting expectations
   for US interest-rate cuts and causing a surge in the stock market’s “fear gauge”.
 * The dip in gold prices and contrasting outlooks from OPEC and the IEA contributed
   to a mixed market sentiment alongside the steady rise in oil prices.

The inflation data dampened expectations for early US interest rate cuts, leading
to a drop in the odds of a rate cut in May.

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The Golden Dragon index of US-traded Chinese companies dropped 2.7% on Tuesday, 
marking its largest decline in nearly a month. Trading is expected to resume in 
Hong Kong while China remains closed for the Lunar New Year holidays. Meanwhile,
swap traders lowered their expectations for a Fed cut before July, and the stock
market’s “fear gauge” – the VIX – experienced its biggest surge since October.

The CPI data disappointed investors after a recent decrease in price pressures, 
leading to reduced expectations for rate cuts this year. This supports the wait-
and-see approach emphasized by Jerome Powell and other Fed speakers. The likelihood
of a May cut decreased to about 32% from 64% before the inflation data, with less
than 90 basis points expected this year.