On August 14 local time, data released by the US Labor Department showed that the US Producer Price Index (PPI) for July rose significantly, exceeding market expectations and dampening hopes for a potential Fed rate cut in September. Affected by this, Asia-Pacific stock markets performed weakly last Friday. However, for the entire week, most Asia-Pacific markets still saw gains.

Last week, most Southeast Asian stock markets rose. Thailand’s SET index edged up 0.03% to 1,259.42 points; Vietnam’s Ho Chi Minh Index gained 3.08% or 48.86 points to 1,633.81 points; Indonesia’s Jakarta Composite Index (JKSE) surged 4.84% or 364.99 points to 7,898.38 points; Singapore’s Straits Times Index fell 0.22% to 4,230.53 points; Malaysia’s Kuala Lumpur Composite Index rose 1.24% to 1,576.34 points; and the Philippines’ Manila Index dropped 0.37% to 6,315.93 points.

Other major Asia-Pacific stock indices also rose. Japan’s Nikkei 225 Index climbed 3.37% or 1,557.83 points to 43,378.31 points; South Korea’s KOSPI Index gained 0.49% to 3,225.66 points; and Australia’s S&P/ASX 200 Index rose 1.49% to 8,938.6 points.

Wei Hongxu, a researcher at ANBOUND Research Center, told the 21st Century Business Herald that the positive trend in Asia-Pacific stock markets is due to two factors: first, the clarification of US tariff policies toward many Asia-Pacific countries has reduced market uncertainty; second, with the Fed’s rate cut expectations becoming clearer, the loose monetary stance of the US dollar is largely confirmed, leading to capital spillover into Asia-Pacific markets and boosting emerging market performance.

Wang Youxin, director of the Bank of China Research Institute, analyzed for the 21st Century Business Herald that Asia-Pacific stock markets will likely exhibit overall volatile upward movement with increasing divergence in the future. “The start of the Fed’s rate-cut cycle will lower financing costs, benefiting tech stocks and high-growth sectors. A weaker US dollar and stronger Asian currencies will also improve the asset returns of emerging markets, attracting more foreign capital into Asian stock markets. However, the timing, pace, and magnitude of Fed rate cuts remain highly uncertain. If rate cuts fall short of expectations, it could trigger short-term market volatility, and the US dollar may rebound temporarily, weighing on emerging market stocks.”

He further noted that uncertainties in US tariff policies and global economic weakness could also impact export-oriented economies.