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      Asian Stocks Rally as US Inflation Data Eases Rate Hike Concerns

      Asian equity markets experienced a significant rally on August 13, driven by the latest US inflation data, which showed a month-on-month increase of just 0.1% for July, aligning with analyst expectations. This modest inflation reading contributed to a drop in the likelihood of a Federal Reserve rate hike in September, with market-implied probabilities falling from 54% to approximately 40%.

      The MSCI Asia-Pacific ex-Japan index rose by 0.97%, reflecting positive sentiment across the region. Notably, South Korea's KOSPI surged by 4.4%, marking a remarkable single-day increase, while Japan's Nikkei 225 gained 1.86%. These movements indicate strong investor confidence in the wake of the inflation report, which has implications for future Fed policy.

      Despite the positive market response, concerns remain regarding elevated oil prices, which have been fluctuating between $80 and $88 per barrel due to geopolitical tensions. While this price range is not detrimental to the global economy, it does exert upward pressure on inflation figures worldwide. The upcoming August Consumer Price Index data will be crucial, as continued declines in inflation could further support the case for a Fed pause and sustain the momentum in Asian equities.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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