Noteworthy guidance from the U.S.

Federal Reserve has reinforced the higher-for-longer interest rates narrative, impacting risk sentiment and leading to a selloff in risk assets.

This resulted in a more robust dollar in offshore trading.

The Fed’s outlook suggests one more rate hike this year and two fewer cuts in 2024 than formerly implied.

This hardened hawkish stance signaled to investors that monetary policy would be substantially tighter through 2024 than initially considered.

Wall Street ended the day lower, Treasury yields surged to multi-year highs, the U.S.

dollar overcame earlier losses to close higher, and commodities saw a decrease.

This unfavorable sentiment, expected to influence Asian markets, carries an undertone of prudence as more central banks make their decisions on rates.

Decisions from the central banks of Indonesia, the Philippines, and Taiwan will be closely watched during Asian hours, alongside rate decisions from Britain, Switzerland, Norway, Sweden, Turkey, and South Africa later in the day.

U.S.

stocks saw a drop with the Dow down by 0.22%, S&P 500 by 0.94%, and Nasdaq by 1.53%.

U.S.

yields rose owing on provisionally hawkish Federal Reserve with 2-year treasuries up 7 basis points to 5.1850%, and 10-year and 30-year treasuries up 4 and 2 bps to 4.4110% and 4.4460% respectively.

Oil prices also suffered a hit with Brent crude down 0.9% and WTI reducing 1%.

U.S.

copper gave away its early gains to end down 0.25%, while gold appeared stationary.

The U.S.

dollar strengthened 0.25% in fluctuating trading; with changes in other currencies such as EUR down 0.15%, USD/JPY up 0.30%, GBP down 0.40%, USD/CHF up 0.10%, AUD, NZD and USD/CAD down and flat by 0.10% each and USD/CNH remained stable.

The impact on Asian markets and subsequent decisions by central banks across different countries will be influential in shaping the market dynamics further.