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A pedestrian jogs along the Bund across from buildings in Pudong's Lujiazui Financial District in Shanghai, China, on Thursday, Jan. 2, 2025.
Bloomberg | Bloomberg | Getty Images
Asia-Pacific markets are set for a mixed open even as Wall Street gained following the Federal Reserve's decision to hold interest rates steady. The U.S. central bank also noted that a severe economic downturn was unlikely.
Australia's S&P/ASX 200 traded 0.77% higher at the open. Hong Kong's Hang Seng index futures were at 24,719, weaker than the HSI's last close of 24,771.14.
Japan markets are closed for a holiday.
China is expected to report its Loan Prime Rate later in the day, while Taiwan's central bank is also slated to release its policy rate decision.
The Federal Reserve held interest rates steady at 4.25% to 4.5% on Wednesday, while signaling that they anticipate two rate reductions later in the year. Their economic projection also foresaw rising inflation and reduced economic growth.
Fed Chair Jerome Powell also noted that while economists sounded the likelihood of a recession, a severe downturn is not likely. The Fed's decision comes against a backdrop of festering tensions between the U.S. and its key trade partners.
U.S. stock futures were little changed after the three major averages rallied after the Fed maintained its outlook for two interest rate cuts this year.
Overnight in the U.S., the three major averages closed higher. The S&P 500 clawed back more of the rout since late February that took the benchmark briefly into correction territory. The Dow Jones Industrial Average climbed 383.32 points, or 0.92%, and closed at 41,964.63. The S&P 500 jumped 1.08% to end at 5,675.29, and the Nasdaq Composite advanced 1.41% to settle at 17,750.79.
CNBC's Sean Conlon and Pia Singh contributed to this report.
Weaker growth, higher inflation 'balance each other out' in Fed forecast, Powell says
U.S. Federal Reserve Chair Jerome Powell speaks at a press conference, following a two-day meeting of the Federal Open Market Committee on interest rate policy, in Washington, D.C., U.S., March 19, 2025.
Nathan Howard | Reuters
Fed Chair Powell said the central bank's forecasts for less economic growth and higher inflation in 2025 somewhat offset each other, explaining the fact that the forecast for rate cuts this year stayed at two.
"At the December meeting, the median was two cuts. So you come in and you see, broadly speaking, weaker growth but higher inflation. And they kind of balance [each other] out," he said.
Again, Powell emphasized the forecasts are "highly uncertain."
— Jesse Pound
Stocks close higher after Fed policy decision
The three major averages finished Wednesday's session in positive territory after the Federal Reserve decided to leave interest rates unchanged.
The Dow Jones Industrial Average rose 383.32 points, or 0.92%, to close at 41,964.63. The S&P 500 gained 1.08% to finish at 5,675.29, and the Nasdaq Composite jumped 1.41% to finish at 17,750.79.
— Sean Conlon
English (US)