Asian Markets Stumble as Geopolitical Tensions and Fed Decision Loom Over Investors
The mood was subdued ahead of key economic data and policy announcements, with traders reassessing risks from inflation and trade disputes.
Japan’s economy contracted in the third quarter, adding to concerns as relations with China worsened. Over the weekend, a Chinese fighter jet locked fire-control radar onto Japanese military aircraft, escalating tensions between the two nations. The incident cast a shadow over Asian equities, with MSCI’s regional index slipping 0.1%. Australia’s stocks and Japan’s Nikkei 225 also edged lower.
Investors are now looking to China’s November trade figures, due later this week, for clues on economic strength. The data will also show whether modest US tariff relief has had any impact. Meanwhile, the Federal Reserve is still expected to cut interest rates on Wednesday, though uncertainty remains over the path for 2026.
Gold prices rose as China’s central bank extended its buying streak to a 13th month in November. The precious metal benefited from safe-haven demand amid geopolitical strains and inflation worries. In Europe, French President Emmanuel Macron warned that the EU could impose tariffs on China if its trade surplus with the bloc continues to grow.
Elsewhere, Qatar Airways Group named Hamad Ali Al-Khater as its new CEO, effective December 7, 2025. The appointment comes as the airline industry faces shifting global demand and economic pressures.
Markets remain on edge as central banks prepare policy updates and geopolitical risks linger. The Fed’s rate decision and China’s trade data will be closely watched for signals on economic momentum. With inflation concerns persisting, traders are questioning whether this year’s AI-driven stock rally can hold.
