Asian stock markets dipped on Wednesday as investors remained cautious ahead of U.S. President Donald Trump’s July 9 tariff deadline and amid growing uncertainty over interest rate cuts by the Federal Reserve. The dollar also stayed weak, hovering near its lowest point since early 2022.
The MSCI Asia-Pacific index outside Japan slipped 0.23% in early trading. Japan’s Nikkei dropped 0.78%, dragged down by tech stocks. Similarly, Taiwan and South Korea’s indices also saw declines after recent gains in global tech shares faded under pressure.
President Trump recently confirmed he will not extend the July 9 deadline for trade deal talks, casting fresh doubts on reaching agreements—especially with Japan. However, he expressed hope for a deal with India, which softened sentiment slightly.
Meanwhile, investors are watching U.S. labor data closely. Job openings in May increased unexpectedly, suggesting economic resilience. However, Thursday’s non-farm payrolls report will be crucial in shaping expectations around the Fed’s next move on interest rates.
Trump’s massive $3.3 trillion tax-and-spending bill is also weighing on sentiment. Although it passed the Senate, analysts say it adds to long-term fiscal concerns. Traders now see limited chances of rate cuts this month, which continues to keep the dollar under pressure.
With investors shifting away from U.S. assets, the greenback has dropped over 10% this year—its worst first-half performance in decades. As a result, gold has surged nearly 27% in 2025 so far, with spot prices holding steady at $3,332.19 per ounce after Tuesday’s 1% jump.