Global Markets on Edge as Fed Rate Cut Looms

Asian stocks dropped as investors await U.S. interest rate changes. The Federal Reserve is expected to cut rates, but future actions remain uncertain. Currency and commodity markets remain steady, while Japan deals with the aftermath of a powerful earthquake.

On Tuesday, Asian stocks experienced a dip, with the U.S. dollar holding firm as investors anticipated a U.S. interest rate cut. The Japanese yen remained stable following a major earthquake in Japan's northeast, despite its limited impact on the financial markets.

Investor sentiment was cautious, given the upcoming central bank meetings, including the Reserve Bank of Australia's decision day. The RBA, SNB, and Bank of Canada are all expected to maintain current rates, while the Federal Reserve is likely to lower borrowing costs soon.

The focus is not just on the expected Fed rate cut but on future policy directions. Economists predict fewer Fed cuts next year due to persistent inflation and a resilient U.S. economy, as traders closely monitor bond market movements and currency trends.

(With inputs from agencies.)