Most Asian stocks dropped in generally muted trading as investors awaited clues on the Federal Reserve’s policy path in its final interest-rate decision of the year.
Chinese equities led declines after a government report showed inflation edged up in November, damping expectations for lower interest rates. Shares also dropped in Japan and Australia, while US stock futures were little changed.
Silver extended gains after rising to a record, while the dollar was mixed against its major peers. Traders are anticipating a third consecutive Fed rate cut Wednesday, while the focus will be on the central bank’s latest dot plot, economic projections and comments from Chair Jerome Powell.
Volatility around the decision has been among the defining characteristics of equity trading in the past six weeks, superseding concern about a potential AI bubble and the impact of President Donald Trump’s trade policies.
“Asian equities are drifting in light red as investors brace for one of the most ‘known-yet-unknown’ final Fed packages of the year,” said Hebe Chen, an analyst at Vantage Markets in Melbourne.
“With a 25 basis-point cut widely viewed as locked in, the real swing factor will be the Fed’s economic projections, unusually delivered without a full quarter of verified data — leaving a wide runway for interpretation and volatility.”
