Asian markets drop as trades fret over US inflation, rates outlook [Video]

Asian markets struggled Thursday after a tepid lead from Wall Street, with investors growing increasingly worried about the outlook for inflation and US interest rates as Donald Trump’s second presidency looms.

A report saying the president-elect was considering declaring a national economic emergency to provide legal cover to impose tariffs on all imported goods added to the sense of uncertainty on trading floors.

Sentiment was also clouded by data showing that Chinese consumer inflation remained almost non-existent despite a raft of stimulus measures in the final three months of last year.

Equities have had an unremarkable start to 2025 after the Federal Reserve in December made a hawkish pivot and indicated it would not cut rates as much as initially expected over the next 12 months owing to sticky inflation and a still-strong labour market.

Worries about Trump’s plans to slash taxes, regulate immigration and ramp up tariffs have also …