Asia Stocks Increase On Hopes Regional Central banks Hold steady On Rates

Asia's stock markets rose on Tuesday, boosted by investor confidence that the region's central banks will continue to pause or end interest rate hike cycles, regardless of what the US Federal Reserve does.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.44 percent as trading resumed in many major Asian markets following a long holiday weekend.

South Korea's central bank held interest rates steady for the second consecutive meeting on Tuesday morning, as expected.

Meanwhile, China's disappointing consumer price index reading on Tuesday - a 0.7% year-on-year increase, or an 18-month low - strengthens the case for policymakers to take additional steps to boost the economy's recovery from the pandemic's impact.According to Gary Ng, senior economist at Natixis Corporate and Investment Bank, Asian economies are more cautious about raising rates because their desire to maintain growth outweighs concerns about taming inflation, which is a bigger concern in the United States and Europe.

Strong employment data in the United States released on Friday fueled expectations that the Fed would raise rates in May, but the 25 basis point increase now priced in by the market is less than what had been estimated, according to Ng.

"I think investors are more optimistic about the end of the rate cycle," he continued, "but whether we are already at the top - that is really the key driver of this oscillation that we are seeing right now."

The Nikkei 225 index in Japan advanced 1.34 percent to extend its gains as the market welcomed the new Bank of Japan governor's first public remarks on the central bank's ultra-easy monetary policy.

The Japanese yen fell 0.19 percent against the US dollar to 133.34.

Australia's S&P/ASX 200 index gained 1.25 per cent with miner Newcrest's shares jumping as much as 7.1 per cent on an improved takeover offer from Newmont, making it the top gainer on the benchmark.

Hong Kong stocks traded mixed as sentiment took a hit after data indicating China's demand weakness persists, but property developers rose.

The stock price of Chinese property developer Longfor Group 0960.HK jump as much as 8.9 per cent to HK$23.30, its highest since March 8.

Shares of Chinese artificial intelligence company SenseTime reversed earlier gains of as much as 11 per cent, falling more than 6 per cent on Tuesday.

Elsewhere, the yield on benchmark U.S. Treasury 10-year notes fell by one basis point to 3.4055 per cent.

The dollar index edged down by 0.146 per cent to 102.32. Gold price rose 0.32 per cent to $1996.25 on Tuesday as the dollar weakened.

Major cryptocurrency bitcoin reached the $30,000 level for the first time in 10 months on Tuesday, adding to its steady gains as investors raised bets the Fed may soon end its tightening.

Bitcoin peaked at $30,438 in Asian trade and was last 2 per cent higher at $30,262. It has gained about 6 per cent since the start of the month, after rising 23 per cent in March.