Asia-Pacific Declines

Asia-Pacific markets lost momentum Tuesday as major indexes across the region erased earlier gains, but oil prices trended higher. Chinese mainland shares also advanced.

In Japan, the Nikkei 225 dumped 76.27 points, or 0.3%, to 28,257.25.

Japan’s central bank left its short-term interest rate target unchanged at -0.1%, in line with market expectations, and said it will purchase a necessary amount of Japanese government bonds such that the 10-year JGB yields will remain at around 0%.

The Bank of Japan also raised its near-term inflation expectations: for the fiscal year starting in April, inflation forecast was raised from an earlier estimate of 0.9% to 1.1%. For fiscal 2023, inflation expectation was raised from 1% to 1.1%.

Still, those figures remain below the central bank’s inflation target of 2%. Unlike global peers such as the U.S. Federal Reserve, BOJ said it will continue with its quantitative and qualitative monetary easing with yield curve control for “as long as it is necessary” to achieve and maintain the 2% inflation target.

The Japanese yen changed hands at 114.83, weakening from an earlier level around 114.43.

The Hang Seng index in Hong Kong dropped 105.25 points, or 0.4%, to 24,112.78.

Australian indices fell as the heavily weighted financials sub-index faltered 0.3.

The Australian dollar gave up gains and fell 0.12% to $0.7201.

CHINA

In China, the CSI 300 advanced 46.07 points, or 1%, to 4,813.35.

Chinese President Xi Jinping cautioned against a rapid rise in interest rates on Monday that could derail the global recovery from the coronavirus pandemic.

He also called for countries to move away from a "Cold War mentality," saying history has repeatedly shown that confrontation only invites disastrous repercussions.

In the previous session, Asia markets had a muted reaction to official data out of China, which showed the world’s second-largest economy grew faster than expected between October and December.

The country’s state planner said Tuesday that China has “relatively plenty” of policy tools in reserve to deal with a challenging year ahead, and that it will roll out these measures in a timely manner to stabilize growth.

In other markets

In Korea, the Kospi index slipped 25.86 points, or 0.9%, to 2,864.24.

In Taiwan, the Taiex index staggered 146.8 points, or 0.8%, to 18,378.64

In Singapore, the Straits Times Index retreated 7.91 points, or 0.2%, to 3,280.04.

In New Zealand, the NZX 50 took on 7.56 points, or 0.1%, to 12,814.46.

In Australia, the ASX 200 lost 8.53 points, or 0.1%, at 7,408.78.

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