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Asian shares shaky as U.S. readies China tariffs, euro at 2-week low on ECB

Reuters  |  TOKYO 

By Tomo Uetake

TOKYO (Reuters) - Asian shares wobbled on Friday as investors braced for U.S. tariffs against China, while the flirted with two-week lows after a cautious indicated it would not raise interest rates for some time.

U.S. has made up his mind to impose "pretty significant" tariffs and will unveil a list targeting $50 billion of Chinese goods on Friday, an said. has warned that it was ready to respond.

While it is not clear when Trump will activate the measures, rising Sino-U.S. trade tensions will put additional pressure on China's economy, which is starting to show signs of cooling under the weight of a multi-year crackdown on riskier lending.

The Asia Pacific MSCI index <.MIAPJ0000PUS> edged down 0.2 percent, with most regional markets shrugging off a strong close on Wall Street. But Japan's Nikkei average <.N225> added 0.5 percent.

The was headed for its worst weekly loss in 19 months after the ECB signalled on Thursday it will keep interest rates at record lows into at least mid-2019, even as it pledged to end its massive bond purchase scheme by the end of this year.

The common currency shed 1.9 percent after the rate comments in its sharpest daily fall in almost two years.

In early Asian trade on Friday, it eased 0.1 percent lower to $1.15595, its lowest level since May 30.

The dollar index <.DXY> against a basket of six major peers gained about 0.2 percent to a two-week high of 94.973, after rallying more than 1 percent the previous day.

The 10-year German bund yield also fell to 0.424 percent from around 0.50 percent before the ECB.

"The ECB has made it clear that it does not want quick rate hikes, although it now considers progress towards the inflation target as 'substantial'. Against the background of uncertainties in the world today - such as trade - this makes sense, as does the emphasis on data dependency," Stefan Kreuzkamp,

On Wall Street, two of the three main indexes closed higher, with leading the charge on the benchmark

Helping boost U.S. equities was a Commerce Department report showing rose more than expected in May, the latest indication of an acceleration in economic growth in the second quarter.

While the Fed and the ECB provided much of the week's fireworks, the is expected to produce no surprises at the end of a two-day policy meeting on Friday. Virtually no one is forecasting changes to its huge stimulus programme given stubbornly weak inflation and recent signs of slowing growth.

edged up, despite the strengthening dollar and fears that OPEC countries could decide to increase output at a meeting next week.

Intermediate (WTI) were up 0.2 percent at $67.02 per barrel, while Brent was at $76.02.

Many markets in were closed on Friday for holidays celebrating the end of Ramadan.

(Reporting by Tomo Uetake; Editing by Kim Coghill)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, June 15 2018. 07:04 IST
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