Asian Stocks Rise Amid Weakening US Economic Momentum

Asian stocks mostly rose on August 17 after a retreat on Wall Street as investors assessed fresh data that tempered expectations for a US interest rate hike but indicated weakness in the world's top economy.

Hopes that the US Federal Reserve will not tighten policy in September boosted equities last week, pushing the S&P 500 and Nasdaq to records. Closely watched reports pointed to a softening labour market and inflation easing, even if it is still well above target.

However, figures on August 14 raised questions about the health of the economy and led observers to warn that investors should be careful what they wish for. Retail sales fell 0.6 per cent month on month in July, the worst performance in more than a year, while consumer sentiment plunged as households battered by fallout from the US-Iran conflict curbed spending and raised their expectations of inflation.

Fawad Razaqzada at Forex.com noted that 'taken together, the data suggest that US economic momentum may be losing some steam, strengthening expectations that the Federal Reserve could leave rates unchanged in September.'