adminHONG KONG. — Asian markets were mixed yesterday in a muted reaction after US Federal Reserve chief Ben Bernanke said the bank had no plan to wind down its stimulus until the economy was back on track.
The comments, which came as a closely watched report said growth was moderate, helped calm nervous dealers as Wall Street ended in positive territory.
Tokyo rose 1,32 percent, or 193,46 points, to 14 808,50 as confident forex dealers pushed the dollar back above the 100 yen level, while Sydney added 0,24 percent, or 11,7 points, to close at 4 993,4.
However, Seoul fell 0,64 percent, or 12,01 points, to 1 875,48 and Hong Kong dipped 0,12 percent, or 26,65 points, to 21 345,22 while Shanghai shed 1,05 percent, or 21,52 points, to 2 023,40.
In the first of his two days of testimony to Congress, Bernanke told Representatives the vast bond-buying programme would remain in place until the Fed is happy the economy can stand on its own two feet.
“I emphasise that, because our asset purchases depend on economic and financial developments, they are by no means on a present course,” Bernanke told the lawmakers.
When launching the scheme in September the bank said it would only reel it in when unemployment had fallen to a satisfactory level.
Bernanke said the economy was expanding at a moderate pace and showed solid signs of strength in various areas, a view supported by the Fed’s Beige Book report, which was also released on Wednesday.
SMBC Nikko Securities general manager of equities Hiroichi Nishi said: “Bernanke’s words were nothing new, but did have a calming effect for those still harbouring jitters about a near-term end of the US easing policy.”
The testimony lifted US shares. The Dow added 0,12 percent, the S&P 500 put on 0,28 percent and the Nasdaq was up 0,32 percent.
On forex markets the dollar broke back above the 100 yen barrier as traders saw the news as a boost for the regional economy.
In afternoon trade the greenback was at 100,25 yen, compared with 99,60 yen in New York on Wednesday, while the euro fetched US$1,3109 and 131,37 yen against US$1,3125 and 130,73 yen.
Eyes were on a meeting of G20 finance ministers yesterday and today in Moscow, where officials are expected to discuss the Fed’s stimulus, while Japan will hold upper house elections at the weekend.
On oil markets New York’s main contract, West Texas Intermediate for August delivery, was down eight cents at US$106,40 a barrel, while Brent North Sea crude for September shed 11 cents to US$108,50. — AFP.
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