Singapore/New York (February 14, 2025); Asian stock markets climbed higher on Friday, tracking Wall Street’s gains, while the U.S. dollar eased as investors reacted cautiously to President Donald Trump’s proposed reciprocal tariffs, which were not immediately enforced. This development temporarily eased concerns over a potential global trade war.
On Thursday, Trump announced plans to impose reciprocal tariffs on any country that taxes U.S. imports. However, instead of immediately implementing new levies, he initiated an investigative process that could take weeks or months. This uncertainty fueled volatility in global financial markets, with gold prices surging for the seventh consecutive week.
In Asia, Chinese tech stocks continued their rally, pushing Hong Kong’s Hang Seng Tech Index to a three-year high on Thursday. On Friday, Hong Kong’s benchmark Hang Seng Index rose 1.6%, extending its weekly gains to 5%, marking its best performance in four months.
Meanwhile, Japan’s Nikkei fell 0.55%, though it remained on track for weekly gains. The MSCI Asia-Pacific Index outside Japan hovered near a two-month high.
U.S. inflation data also played a role in market movements. The Producer Price Index (PPI) for January exceeded expectations, rising 0.4%, while the Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, showed softer components, raising hopes of a cooler reading.
Despite this, expectations for a Fed rate cut remain distant, with traders now pricing in the first cut in October. The European Central Bank, however, is expected to move aggressively with rate reductions in the coming months.
The U.S. dollar index remained steady after its biggest drop in nearly a month, while the euro hovered at a two-week high amid optimism over potential Ukraine-Russia peace talks.
Source: Reuters
