Source: Sharecast
The Federal Open Market Committee maintained its benchmark rate at a range of 4.25% to 4.5%, where they had remained since December.
While the decision came as no surprise to markets, Fed chair Jerome Powell cautioned that persistent tariff hikes could dampen economic growth and contribute to higher long-term inflation.
‘Stock-index futures and Asian shares soared on Thursday as Trump revealed plans to unveil a significant trade deal, raising optimism about progress in negotiations,” said TickMill market strategy partner Patrick Munnelly.
“The pound initially rose before reversing as rumours regarding a US/UK trade deal were confirmed by UK officials; however, disappointment on the details or lack thereof has seen investors book quick profits on the pound's pop in a buy the rumour, sell the news trade.
“Trump’s announcement of the agreement in a tweet on Truth Social, without mentioning the specific country involved.”
Munnelly noted that sources familiar with the matter indicated that the administration intended to announce a deal with the UK.
“Asian markets rebounded from losses of as much as 0.5% to increase by 0.3%.
“Since early April, market instability has significantly decreased, aided by Trump's trade concessions and a series of positive US economic reports that bolstered bullish sentiment.
“The US president had imposed tariffs on Chinese imports, which led to retaliatory actions from China.”
Most markets rise as Fed stands pat on rates
In Japan, the Nikkei 225 rose 0.41% to close at 36,928.63, supported by strong gains in technology and industrial shares.
NTT Data surged 16.73%, while IHI and Yokogawa Electric climbed 8.26% and 6.25%, respectively.
The broader Topix index edged up 0.1% to 2,698.72.
Chinese equities also posted gains, with the Shanghai Composite up 0.28% to 3,352.00 and the Shenzhen Component rising 0.93% to 10,197.66.
Gains in Shanghai were led by Huafang, Shanghai Phoenix Enterprise Group, and Nanjing Canatal Data Centre Environmental Tech, each advancing over 10%.
Hong Kong’s Hang Seng Index added 0.37% to 22,775.92, buoyed by strong performances from Li Auto, Geely Automobile Holdings, and WuXi Biologics.
South Korea's Kospi 100 slipped 0.1% to 2,556.99, dragged down by sharp declines in KakaoPay, Naver Corporation, and Hanon Systems.
Meanwhile, Australia's S&P/ASX 200 inched up 0.16% to 8,191.70, with Polynovo jumping 11.45% and Orica and Platinum Asset Management also posting strong gains.
New Zealand’s S&P/NZX 50 bucked the regional trend, falling 0.24% to 12,467.03, as Pacific Edge, Vista Group International, and Ryman Healthcare recorded notable losses.
In currency markets, the dollar was last up 0.69% on the yen, trading at JPY 144.82, as it gained 0.19% against the Aussie to AUD 1,5596, and strengthened 0.4% on the Kiwi, changing hands at NZD 1.6901.
Oil prices also climbed, with Brent crude futures last up 1.05% on ICE at $61.76 per barrel, and the NYMEX quote for West Texas Intermediate gaining 1.22% to $58.78.
PBoc lowers key policy rate, Philippines economy grows
In economic news, China’s central bank lowered a key policy rate on Thursday as part of its ongoing monetary easing efforts.
The People’s Bank of China reduced the borrowing cost of its seven-day reverse repurchase agreements by 10 basis points to 1.4%, down from 1.5%.
It followed Wednesday’s announcement of further easing, and was applied to a CNY 158.6bn liquidity injection.
As the seven-day reverse repo rate is China’s main policy rate, the cut could pave the way for declines in broader market rates to support economic activity.
In the Philippines, the economy grew 5.4% year-on-year in the first quarter of 2025, marginally higher than the prior quarter’s 5.3% pace but below the 5.7% forecast in a Reuters poll.
Growth was driven by strength in manufacturing, financial and insurance services, and wholesale and retail trade, according to the country’s statistics authority.
Reporting by Josh White for Sharecast.com.