Customers at a fresh food market in Shanghai, China, on Monday, Aug. 7, 2023.
Bloomberg | Bloomberg | Getty Images
Asia-Pacific markets tumbled after U.S. inflation for March came in hotter than expected, stoking worries that the Federal Reserve may keep interest rates higher for longer.
U.S. consumer price index climbed 3.5% on a year-on-year basis and 0.4% compared with the previous month. Economists surveyed by Dow Jones had expected a 0.3% month-on-month gain and 3.4% year-over-year rise.
Excluding volatile food and energy components, the core CPI also accelerated 0.4% on a monthly basis while rising 3.8% from a year earlier, compared with respective estimates for 0.3% and 3.7%.
China’s consumer inflation slowed to 0.1% in March from 0.7% in February. Economists polled by Reuters expected the consumer price index to climb 0.4% in March.
The producer price index recorded a 2.8% fall year on year, in line with expectations.
Hong Kong’s Hang Seng index tumbled 1.18%, while the CSI 300 index in mainland China saw a smaller loss of 0.56%.
South Korean markets resumed trade after a public holiday, with the Kospi falling 0.48% and the small cap Kosdaq sliding 0.36%.
South Korea’s liberal opposition parties scored a landslide victory in a parliamentary election held on Wednesday, likely handicapping incumbent president Yoon Suk Yeol and his conservative party’s efforts to push through their legislative agenda.
Japan’s Nikkei 225 fell 0.69%, while the broad-based Topix dropped 0.15%.
In Australia, the S&P/ASX 200 slipped 0.72%.
Overnight in the U.S., all three major indexes plunged as the 10-year Treasury yield spiked, with the Dow Jones Industrial Average leading losses and tumbling 1.09%.
The S&P 500 dropped 0.95%, with ten of the 11 S&P 500 sectors finishing the session in negative territory, while the Nasdaq Composite sank 0.84%.
The rate on the 10-year Treasury note topped 4.5%, while the 2-year Treasury yields surged close to 5%.
— CNBC’s Sarah Min and Sophie Kiderlin contributed to this report.