Asian Markets Rally as US Employment Report Looms

The Asian markets saw a rally on September 3, as investors positioned themselves ahead of the US employment report due to be released on Friday. The MSCI Asia-Pacific index excluding Japan rose by 0.5%, and Japanese government bond yields declined from recent highs.

The probability of a 25-basis-point Federal Reserve rate increase has risen to nearly 66% according to market pricing, up from 37% a week earlier. This comes as the Fed's next policy meeting is scheduled for September 15-16.

The yen strengthened against the dollar, reaching 157.95 per dollar, while Japanese domestic activity showed a stronger economic signal with the S&P Global final services Purchasing Managers' Index rising to 52.5 in August from 51.2 in July.