HONG KONG- The better-than-expected US retail data boosted Wall Street equities, although Asian shares failed to follow suit.
MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.45 percent edging off Tuesday’s near three-week closing high, with declines in most markets, while Japan’s Nikkei lost 0.4 percent.
The dollar reached a high of 114.97 yen in early Asian hours, its strongest since March 2017, while the euro languished at a 16-month low at $1.1320.
The greenback was helped by Tuesday data which showed US retail sales rose faster-than-expected in October, potentially encouraging the US Federal Reserve to accelerate the tapering of its asset purchase program, as inflation remains stubbornly high.
“The data backs up that sense that things are going pretty well, and the Fed can be a little more aggressive if it wants to be without completely causing the party to crash,” said Rob Carnell, head of research for Asia Pacific at ING.
“Top of mind for everyone is inflation right now, it’s still an issue after the numbers we got from the US yesterday, and we’ve got a whole barrage of other inflation data coming today, particularly the U.K and Canada,” he added.
Britain publishes its October CPI inflation data later today with a high print likely to add pressure on the Bank of England to raise rates in December after surprising markets by holding fire last month.
