^{Source: The Jakarta Post}

Asia-Pacific Stocks Rise as China and Australia Deliver Policy Support Amid Global Growth Concerns

Regional Market Highlights
Asia-Pacific markets saw moderate gains on Tuesday following fresh stimulus signals from China and a surprise rate cut from the Reserve Bank of Australia (RBA). Investors parsed through these central bank decisions as part of a broader narrative around slowing global growth, ongoing trade frictions, and easing inflationary pressures.

China Trims Key Lending Rates to Stimulate Growth

In a bid to inject momentum into its sluggish economy, the People’s Bank of China (PBOC) lowered its key loan prime rates by 10 basis points. The 1-year loan prime rate (LPR) was cut to 3.0% from 3.1%, while the 5-year LPR — often used as a benchmark for mortgage rates — was reduced to 3.5% from 3.6%. These cuts reflect Beijing’s continued efforts to support domestic demand amid persistent property sector weakness and trade challenges with the U.S. and EU.

Analysts at Nomura said this modest rate cut may be the first in a series if economic data doesn’t rebound, noting that China's GDP growth for Q1 2025 came in at a weaker-than-expected 4.1% year-over-year.

Stock Market Reaction Across Asia-Pacific

Investors responded positively to the monetary easing. Key indices across the region closed in the green:

• Hong Kong’s Hang Seng Index jumped 1.49%, finishing at 23,681.48, buoyed by gains in tech and energy stocks.
• China’s CSI 300 added 0.57%, ending the day at 3,899.37 amid renewed optimism for more policy support.
• Japan’s Nikkei 225 edged up 0.08% to 37,529.49, while the broader Topix rose 0.02% to 2,738.83.
• South Korea’s Kospi remained flat at 2,601.8, while the Kosdaq, its smaller-cap counterpart, climbed 0.25% to 715.55.
• Australia’s S&P/ASX 200 gained 0.58% to close at 8,343.3, reacting to the RBA’s dovish stance.

RBA Surprises With Rate Cut Amid Cooling Inflation

Australia’s central bank lowered its cash rate by 25 basis points to 3.85%, its lowest since May 2023. This decision comes as headline inflation in the country dipped to 2.4% in Q1 2025 — the lowest in four years — bringing it comfortably within the RBA’s target range of 2%–3%.

In its policy statement, the RBA reiterated that returning inflation to the target band sustainably remains its highest priority, but the improved inflation outlook allows for more accommodative policy.

The Commonwealth Bank of Australia had anticipated the rate cut, citing weaker wage growth and declining household spending as contributing factors.

Battery Giant CATL Debuts with Strong Gains

In corporate news, Contemporary Amperex Technology Co. Ltd. (CATL), the world’s largest battery producer and a major supplier to Tesla and Nio, made a strong debut on the Hong Kong Stock Exchange, surging over 11% on its first day. The IPO raised over $1.7 billion, signaling robust investor appetite for EV-related stocks despite broader market uncertainties.

U.S. Markets Remain Resilient Despite Moody’s Downgrade

Overnight in the U.S., stock markets posted modest gains. The S&P 500 inched up 0.09% to 5,963.60, notching its sixth consecutive session of gains. The Nasdaq Composite was nearly flat, up just 0.02% to 19,215.46, while the Dow Jones Industrial Average advanced 137.33 points (0.32%) to 42,792.07, lifted by a strong rebound in UnitedHealth, which surged 8% after recent declines.

Meanwhile, U.S. Treasury yields cooled slightly, helping support risk appetite. The 10-year note yield settled at 4.521%, while the 30-year bond was at 4.995%.

Outlook: Markets Watching Central Banks, Inflation Trajectories

Investors will continue monitoring global central banks’ policy paths, particularly from the Federal Reserve, European Central Bank, and Bank of Japan. Easing inflation and slowing growth may prompt further accommodative moves, although divergence among major economies remains a key theme.

Meanwhile, geopolitical tensions and trade frictions — especially between China and the West — could weigh on risk sentiment and cap upside for Asian equities.