FX.co ★ Galloping US inflation fuels decline in Asian markets

On Monday, Asia-Pacific stock markets showed so-called Black Friday trading. Moreover, the US stock market was also characterized by such a trend at the end of the week. Consumer Price Index (CPI) data

After the CPI rose by 8.6% in May, it was obvious that any plateau or a decline in US inflation is out of the question. Prices jumped to 40-year highs in annual terms. Moreover, it has become clear that the Fed will further tighten its monetary policy in September as well as it may raise the 50-basis-point rate.

Therefore, on Friday stock indices fell amid such sentiments on Wall Street. The NASDAQ lost 3.5% and Asian stocks followed a downward trend on Monday. Moreover, China is in danger of another COVID-19 lockdown taking into account new rounds of mass testing in Beijing. After over two months of Shanghai's lockdown, China's stock market recovery is very slow. Thus, investors of Asia-Pacific stock markets showed considerable interest in the safe haven asset, i.e. the US dollar.

Asian stock indexes (as of 1 pm GMT)

Notably, all three major US stock indices have registered their biggest weekly decline since January falling by nearly 5% each. The new trading week has already started. However, the S&P500 futures went down 1.5% in Asian market, and the NASDAQ futures fell by 2%. Moreover, a new week since Black Monday suggests investors are becoming extremely pessimistic, in particular amid the US Central Bank's meeting scheduled for Wednesday, June 15.

However, today the Queen of England's Birthday holiday is celebrated in Australia. Therefore, Australian stock remained unchanged till tomorrow.