Asia shares rise on US rally ahead of expected Fed rate hike

TOKYO (AP) — Asian shares mostly rose Tuesday, after Wall Street closed higher on a late buying spree following recent losses as investors await another interest rate increase by the U.S. Federal Reserve.

Markets have been jittery over whether the Fed’s plan to cool the hottest U.S. inflation in four decades might be too aggressive and throw the economy into a recession by pumping the brakes on growth too hard.

Japan reported that its consumer inflation jumped in August to 3.0%, its highest level since November 1991 but well below the 8% plus readings in the U.S. Core inflation excluding volatile fresh food prices climbed 2.8%. The Bank of Japan is set to have a two-day monetary policy meeting later this week, although analysts expect the central bank to stick to its easy monetary policy.

“Expectations are that easy monetary policies are to remain in the upcoming meeting this week. The BOJ Gov. Haruhiko Kuroda previously mentioned that he wanted to see a ‘stable and sustainable rise’ in both wages and prices before considering any policy shift,” Yeap Jun Rong, a market strategist at IG in Singapore, said in a report.

Japan’s benchmark Nikkei 225 added 0.4% to finish at 27,688.42. Australia’s S&P/ASX 200 jumped 1.3% to 6,806.40. South Korea’s Kospi added 0.6% to 2,368.52. In China, where the loan prime rate was kept unchanged, the Shanghai Composite added nearly 0.1% to 3,118.36. Hong Kong’s Hang Seng climbed 1.0% to 18,753.53.

On Monday, Wall Street indexes swayed between modest gains and losses for much of the day before a burst of buying in the final hour of trading. The S&P 500 rose 0.7%, climbing back from a 0.9% slide. It closed at 3,899.89.

The Dow Jones Industrial Average rose 0.6% to 31,019.68 and the Nasdaq composite climbed 0.8% to 11,535.02.

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