Rate-Cut Bets Cause Bonds to Rise, While Gold Falls Below $5,000 – Asia Market Wrap

Bonds rose and equities held steady after benign US inflation data confirmed views that the Fed will drop interest rates this year, helping to calm markets rattled by concerns about AI disruption. Gold slid.

Government bonds in Australia and New Zealand climbed, while Treasury futures remained stable as traders continued to fully price in a Fed cut in July and a strong possibility of a movement in June. US inflation statistics boosted Treasuries on Friday, with 10-year and policy-sensitive two-year rates falling 5 bps.

Asian shares were flat, with the MSCI Asia Pacific Index lingering near record highs after gaining roughly 11% this year. Equity-index futures showed a small increase for European markets.

The Dollar remained stable, while Bitcoin traded near $68,300 after bouncing over the weekend. Oil prices were little changed as traders monitored geopolitical risk ahead of talks between the US and Iran, which are due to begin on Tuesday. Silver dropped as much as 3.6%.

Furthermore, the Yen fell 0.3% against the Dollar, while Japanese bond futures nudged higher as slower-than-expected economic growth dampened bets on BoJ rate increases.