Asia-Pacific stocks drop as China cuts benchmark lending rate for first time since April 2020
SINGAPORE — Shares in Asia-Pacific were lower in Monday trade, with China slashing its benchmark lending rate for the first time in more than one-and-a-half years.
China on Monday announced a cut in its one-year loan prime rate from 3.85% to 3.8% — the first such move since April 2020. Majority of traders and economists in a Reuters poll had expected cuts to the loan prime rate.
Australian stocks also declined, with the S&P/ASX 200 down 0.45%.
MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.9% lower.
Oil drops more than 2%
Those losses came as investors continue to track the spread of the omicron Covid variant, with the World Health Organization recently warning that the number of cases is doubling in 1.5 to 3 days in areas with community spread.
In Europe, the Netherlands went into lockdown from Sunday till at least Jan. 14 amid fears that its healthcare system “will become overburdened in January.” Elsewhere, Britain has also been seeing a surge in Covid infections.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.661 after recently climbing from below 96.