Warsh Speech Looms Large as Asia-Pacific Shares Turn Cautious

Shares in Asia turned cautious on Friday after a Nvidia-fueled technology rally. The MSCI's broadest index of Asia-Pacific shares outside Japan edged up 0.1%, while Japan's Nikkei rose 0.5%. However, Taiwanese shares gained only 1.2% after Nvidia jumped nearly 9% overnight.

The Federal Reserve's Jackson Hole Symposium is the main focus for markets today, where chair Kevin Warsh will speak later in the day. Three Fed officials have already sounded the alarm about sticky inflation, but Warsh has resisted providing forward guidance on interest rates.

Futures imply around a 35% chance that the Fed will raise interest rates when it meets on September 16 and are fully priced for a move by December. Analysts at ANZ note that markets are hoping Warsh will reduce some of the uncertainty surrounding the Fed's reaction function, but they do not expect this to happen.

In the meantime, oil prices were headed for weekly losses as Iran and Oman agreed on administering traffic in the Strait of Hormuz and sharing revenues. Brent eased 0.1% to $89.63 a barrel, set for a weekly drop of over 5%. The Australian dollar was among the best-performing G10 currencies after a hot inflation report this week triggered a sharp repricing of the Reserve Bank of Australia's interest-rate outlook.