TOKYO: Asia stocks eased on Monday as investors reduced expectations of an aggressive interest rate cut by the Federal Reserve, while heightened Middle East tensions following an Iranian seizure of a British tanker lifted crude oil prices.Advertisement
Global equity markets had risen briefly towards the end of last week after dovish comments by New York Fed President John Williams boosted the prospect of the central bank lowering rates by 50 basis points at its July 30-31 meeting. Expectations for a 50 bp cut were scaled back further after the Wall Street Journal reported the Fed was likely to cut rates by 25 bps when it meets later this month, and may make further cuts in the future given global growth and trade uncertainties."The possibility of a 50 bp cut has almost dissipated following the WSJ report and the New York Fed's attempt to tone down earlier comments by Williams," wrote Kenji Yamamoto, economist at Daiwa Securities.