TOKYO/NEW YORK: Asian stocks fell on Wednesday, tracking Wall Street, as investors waited to see if the U.S. Federal Reserve will signal a faster path toward policy normalisation than previously expected.AdvertisementAn index of regional equities excluding Japan sank 0.3per cent, led by declines in South Korea's Kospi and Australia's S&P/ASX 200.Japan's Nikkei 225 bucked the trend to add 0.1per cent, but the broader Topix index was flat to slightly lower.
"We expect Powell to note the FOMC has the tools to intervene if the bond market becomes disorderly or constrains the economic recovery," analysts of Commonwealth Bank of Australia wrote. "U.S. bond yields and the USD could jump if the FOMC’s post‑meeting statement and Powell’s statement are not deemed dovish enough."Benchmark 10-year Treasury yields continued to consolidate around 1.6per cent, standing at 1.6197per cent on Wednesday in Asia. They reached 1.6420per cent on Friday for the first time since February of last year.
Currency market caution may extend all week, with the Bank of England announcing its policy decision on Thursday, and the Bank of Japan wrapping up a policy review on Friday in which it may phase out a numerical target for its asset buying.