Asian Stocks Down after Fed Chair Acknowledges the Risk of a Recession By Investing.com

By Zhang Mengying

Investing.com – Asia Pacific stocks were mostly down on Thursday morning as investors assessed the monetary policy outlook after U.S. Federal Reserve Chair Jerome Powell acknowledged the risk of a recession.

Japan’s stabalized by 8:45 PM ET (1:45 AM GMT).

South Korea’s edged down 0.10%.

In Australia, the rose 0.30%.

Hong Kong’s was up 0.62%.

China’s was up 0.39% while the was down 0.49%.

U.S. 10-year Treasuries yields declined two basis points to 3.13%.

Investors’ concerns grew as Fed Chair Jerome Powell acknowledged the risk of a recession. Powell said that an aggressive interest rate hike could lead to an economic contraction and called a soft landing “very challenging” in his testimony to the Senate Wednesday.

“We are still in an era where uncertainty is elevated and is expected to remain so for quite a while,” Advisors Capital Management portfolio manager JoAnne Feeney told Bloomberg.

“It’s risky right now in terms of the forward outlook for the global economy. Recession risk has clearly risen.”

Powell “has acknowledged that rates will continue to increase, but the FOMC committee is cognizant of watching incoming data, suggesting the Fed will not be exclusively on autopilot with tightening,” Integrity Asset Management portfolio manager Joe Gilbert told Bloomberg.

Powell will continue his testimony to the House later in the day.

On the data front, is due on Thursday while will be released on Friday.