Asian stocks and bonds are expected to fall due to a significant increase in oil prices, which has already caused a selloff in US markets. Brent crude surpassed $107 a barrel on Thursday, contributing to multiyear highs for Treasury yields and pushing the dollar to a one-week peak. The bond market faced additional pressure after a Treasury debt buyback of $5.19 billion was less than anticipated by investors.
The latest inflation data further strengthened expectations for an imminent interest rate hike by the Federal Reserve. A hotter-than-expected producer-price report led traders to increase their wagers on a Fed hike occurring next week. This combination of rising energy costs and inflation data is creating a challenging environment for global markets, especially in Asia.
