Asian Stocks Surge as Weak US Inflation Data Dents Rate Hike Bets

Asian stock markets rose on Thursday as US inflation data came in line with expectations, reducing speculation of further interest rate hikes from the Federal Reserve. The Consumer Price Index (CPI) increased by just 0.1% in July, down from 1.3% in June.

The small increase has weakened the argument for a September Fed rate hike, with money markets now pricing a 40% chance of a hike, down from 54% a week earlier.

Japan's Nikkei index gained 1.86%, while South Korea's shares jumped 4.4%. The MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.97%.