Home / Business and Economy / Asian Stocks Rally on Hopes of US Rate Cut Revival
Asian Stocks Rally on Hopes of US Rate Cut Revival
25 Aug
Summary
- Investors celebrate likely US interest rate cuts
- Nvidia's results this week to impact AI stock valuations
- Inflation data could challenge the market's optimism
On August 25, 2025, Asian share markets experienced a rally as investors celebrated the likely resumption of interest rate cuts in the United States. Federal Reserve Chair Jerome Powell's dovish shift has seen futures price in an 84% chance of a quarter-point rate cut in September, with further easing expected by mid-2026.
This shift has pushed Treasury yields and the US dollar lower, which could benefit corporate earnings. However, it also implies that policymakers now see more danger of a downturn in employment and the economy. Analysts warn that a reading on US personal consumption prices on Friday could show core inflation creeping up to its highest level since late 2023, potentially challenging the market's euphoria.
All eyes are on Nvidia's results on Wednesday, as the company is forecast to report a 48% rise in earnings per share on revenue of $45.9 billion for its second fiscal quarter. The market's reaction to Nvidia's performance could have ripple effects on the broader AI-focused sector, given the company's $4 trillion valuation.
