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Asia markets pause ahead of RBA rates decision

Tuesday 02:00 GMT

Overview

Markets were in wait-and-see mode in Asia trading with investors in Australia awaiting an interest rates decision from the country’s central bank.

Hot topic

Tokyo’s Topix index was flat, while the Nikkei 225 index was off 0.1 per cent. Nintendo was a bright spot with its shares climbing just over 2 per cent, on track for a third straight day of gains following Friday’s launch of the new Switch console.

In Sydney, Australia’s S&P/ASX 200 index was up 0.4 per cent, led by a 1.1 per cent gain for the healthcare sector. But BHP Billiton shed as much as 1.7 per cent after Chilean presidential hopeful Alejandro Guillier met with striking workers at the company’s largest copper mine in the country and said a new contract being offered would lower benefits.

Hong Kong’s Hang Seng index was up 0.1 per cent, with a 0.9 per cent fall in telecoms stocks offsetting gains of 1 per cent in the consumer discretionary segment. In China, the Shenzhen Composite index was down 0.2 per cent.

Forex

The Australian dollar gained 0.2 per cent to $0.7592 against its US counterpart ahead of a monetary policy decision by the Reserve Bank of Australia, which is expected to keep rates on hold.

The Japanese yen softened 0.1 per cent to ¥114 per dollar, while China’s renminbi weakened by the same amount against the greenback, to Rmb6.902. Data due out later on Tuesday from the People’s Bank of China are expected to show foreign exchange reserves dropping further below the $3tn level breached in January.

Fixed income

Moves were relatively muted in sovereign bond markets. The yield, which moves in the opposite direction to price, on 10-year Japanese government bonds was down 1 basis point at 0.058 per cent. The 10-year Australian sovereign yield rose 1bp ahead of Tuesday’s interest rate decision from the RBA.

Commodities

Oil prices were little moved in Asia after making minor gains on Monday.

Brent crude, the international benchmark, was down 0.1 per cent at $55.97 a barrel. The price for a barrel of West Texas Intermediate, the US benchmark, was unchanged at $53.19.

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