Asia-Pacific markets experienced a downturn following higher-than-expected U.S. inflation data for March, raising concerns that the Federal Reserve might maintain higher interest rates for an extended period.
The U.S. consumer price index (CPI) rose 3.5% year-on-year and 0.4% from the previous month, surpassing economists’ expectations of a 0.3% month-on-month increase and a 3.4% year-over-year rise.
Excluding volatile food and energy prices, the core CPI also increased by 0.4% on a monthly basis and by 3.8% from a year earlier, compared to estimates of 0.3% and 3.7%, respectively.
China’s consumer inflation slowed to 0.1% in March from 0.7% in February, below the 0.4% increase expected by economists.
The producer price index in China fell by 2.8% year-on-year, in line with expectations.
Hong Kong’s Hang Seng index dropped by 1.18%, while the CSI 300 index in mainland China saw a smaller decline of 0.56%.
South Korean markets reopened after a public holiday, with the Kospi falling by 0.48% and the small-cap Kosdaq sliding by 0.36%.
In Japan, the Nikkei 225 fell by 0.69%, while the broader Topix dropped by 0.15%.
Australia’s S&P/ASX 200 slipped by 0.72%.
In the U.S., all three major indexes fell as the 10-year Treasury yield surged, with the Dow Jones Industrial Average leading the losses and dropping by 1.09%.
The S&P 500 declined by 0.95%, with ten of its eleven sectors finishing the session in negative territory, while the Nasdaq Composite sank by 0.84%.
The yield on the 10-year Treasury note exceeded 4.5%, while the 2-year Treasury yields surged close to 5%.
