Asian Markets Edge Higher as Yen Stabilizes Amid Global Rate Outlook Shift

Asian stock markets are set for a modest advance as investors react to a stabilization in the Japanese yen following recent volatility. The benchmark Nikkei 225 rose 0.7% in pre-market trading, while South Korea’s Kospi climbed 0.6%, and Hong Kong’s Hang Seng Index gained 0.5%. The gains come amid a quiet session in global macro data, with markets digesting recent comments from the U.S. Federal Reserve and the Bank of Japan suggesting a potential pause in rate hikes. The yen strengthened to 147.3 per dollar, up from 148.8 last week, reflecting reduced demand for safe-haven currency plays. This shift has eased pressure on Japanese exporters, whose earnings were previously pressured by a weak yen. Toyota Motor Corp. shares advanced 1.2% in early trading, while Sony Group Corp. rose 0.9% as investors reassess profit margins. Market watchers are closely monitoring U.S. Treasury yields, which dipped slightly to 4.63% for the 10-year note, indicating a cooling in inflation fears. The shift has lifted sentiment across regional equities, particularly in technology and consumer discretionary sectors. Taiwan’s TAIEX gained 0.8%, driven by gains in semiconductor stocks like TSMC, which rose 1.1% on stronger-than-expected chip demand forecasts. The stability in the yen and mild equity gains reflect a broader market mood of cautious optimism. With central bank policy divergence still in play—especially between the Fed and BoJ—investors remain alert to any new signals on inflation and growth in the coming weeks. The developments are likely to influence capital flows into the region, particularly in Japan and South Korea, where foreign portfolio inflows have been volatile in recent months.