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Asian shares trading at a lower rate as inflation concerns hit market

Asian shares trading at a lower rate as inflation concerns hit market

Asian shares were reportedly trading lower at the start of the week as inflation concerns effectively neutralized optimism created by U.S. President Joe Biden’s remark that the White House was thinking about lowering U.S. tariffs on imports from China.

As per reports, Benchmarks dropped in Australia, Japan, South Korea, and China, despite some of the indexes having been higher at the start of the day. Additionally, prices of oil also dropped by a notable margin.

During a visit to Japan, Joe Biden announced a new economic as well as trade initiative with Asia. He told reporters that he would talk to Treasury Secretary, Janet Yellen, about the punitive tariffs imposed on China during the administration of former U.S. President, Donald Trump.

Biden’s statements raised hope over the potential easing of tensions between the two countries, however, not everyone was satisfied.

As per Yeap Jun Rong, a market strategist at IG, Singapore, the discussion on reducing export tariffs imposed on China have surfaced several times before, and the absence of a concrete follow-up have disappointed markets before.  

Sara Johnson, executive director, S&P Global Market Intelligence, stated that Russia's invasion of Ukraine, COVID-19 waves and subsequent lockdowns in mainland China, worsening financial conditions, and rising inflation have adversely impacted production and suppressed demand, causing the world’s economy to come to a halt.

Worries about inflation have weighed on the market and kept major indexes down. As per reports, in recent weeks, the benchmark S&P 500 index has had its longest weekly losing streak since 2001, when the dot-com bubble was deflating .

It was close to falling 20% from its peak this year, which would put the index at the center of the 401(k) accounts of most workers into a bear market.

A lower U.S. dollar pushed the Japanese yen down to ¥127.61 from the previous ¥127.78 in currency trading, with the euro cost going to $1.0669, down from $1.0688.

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Omkar Patwardhan

Omkar Patwardhan started his professional career in the hospitality industry. Having nurtured a deep-sated passion for words however, he found his way into content writing and now pens down articles for numerous websites, including News Origins, spanning the sectors of business, finance, and technology.