Asia-Pacific Markets Recover from U.S. Inflation Fears as Japan Avoids Technical Recession

Asia-Pacific Markets Recover from U.S. Inflation Fears as Japan Avoids Technical Recession

Most Asia-Pacific markets rebounded on Thursday after mostly falling on Wednesday, as Japan avoided a technical recession despite its GDP contracting for a second straight quarter. Japan’s GDP for the fourth quarter fell 0.4% on an annualized basis, a sharp miss from the 1.4% growth expected by economists polled by Reuters. However, this followed a 3.3% contraction in the third quarter, and two consecutive quarters of contraction are widely considered a technical recession. On a quarter-on-quarter basis, it slipped 0.1%, compared with a 0.3% rise expected in the Reuters poll.

Asia-Pacific markets

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Following the contraction, Japan lost its spot as the world’s third-largest economy to Germany. However, Japan’s Nikkei 225 saw a late rally, rising 1.21% to close at 38,157.94 — the first time the index closed above the 38,000 mark since 1990. The broad-based Topix climbed 0.28% to end at 2,591.85.

 

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In other markets, Singapore saw its fourth-quarter GDP grow 2.2% year on year, lower than the 2.5% expected. The city state also revised its third-quarter GDP growth rate from 2.8% to a sharply lower figure of 1%. In Australia, the S&P/ASX 200 rose 0.77%, snapping a three-day losing streak and ending at 7,605.7. South Korea’s Kospi fell 0.08% and was the only major benchmark in negative territory, while the small-cap Kosdaq was 0.6% higher. Hong Kong’s Hang Seng index was 0.56% higher, extending gains from Wednesday, while mainland Chinese markets were closed for the week.

The Asian markets were also supported by positive trade data from Japan and Australia, as well as improved business confidence among big manufacturers in Japan’s Tankan quarterly survey. The Tankan showed that business confidence at big manufacturers improved more than expected in January and February, indicating a recovery in domestic and external demand.

 

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Source : CNBC NEWS

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