Asian stocks largely continued a global rally on Tuesday, ahead of the release of key US consumer price data that is expected to show slightly slowing inflation in the world’s largest economy. Stocks rose in Japan, Australia, Singapore and Taiwan, with South Korea and Shanghai also gaining after reopening following a public holiday. European stocks were steady at the open. Hong Kong shares edged lower at the close, erasing modest gains made earlier in the day. US consumer price index (CPI) data will be released on Tuesday, with analysts expecting inflation to slow to eight percent, driven mostly by falling gasoline prices. US inflation hit a 40-year high in June, touching 9.1 percent. Easing inflation, however, is unlikely to slow the pace of the US Federal Reserve’s tightening of monetary policy, with another 75-basis-point interest rate hike expected at its meeting next week. The Fed has already instituted two consecutive rate hikes of that amount, and in recent days bank chief Jerome Powell has indicated the increases will continue until inflation is tamed. While the overall US inflation number is expected to slow, prices for food and housing are projected to have increased, raising the strain on household budgets. “Risks remain skewed to the upside, due to an uncertain outlook for key inputs, including agricultural and energy commodities, as well as the pass-through of wage gains in a tight labour market,” according to Barclays US analysts Pooja Sriram and Jonathan Hill. Last week, the European Central Bank also adopted a policy of monetary tightening, raising its key rate by a historic 75 basis points, with analysts expecting a similar-sized increase at the next policy meeting in October. In Tokyo, stocks closed higher on Tuesday, with investors ending the session by tempering some of the gains with caution at the Nikkei’s rise over recent days. Brokerage Okasan Online Securities said investors were looking “to square their positions” ahead of the US CPI data being released. Seoul led the day’s gains in Asia, rising by 2.7 percent on Tuesday. US stocks on Monday had ended bullish: the broad-based S&P 500 advanced 1.1 percent, continuing the upswing last week that snapped a three-week losing streak. “Wall Street is locked into Tuesday’s inflation report that will likely show pricing pressure relief but will not change the Fed from maintaining an aggressive stance of tightening monetary policy,” said Edward Moya, senior market analyst at OANDA. “Even if inflation falls below the 8 percent level, the Fed should still deliver a 75-basis-point rate hike at the September 21st policy decision.” The euro stabilised to $1.0143 against the dollar on Tuesday, after a surge a day earlier that saw it gain 1.4 percent against the US currency and 1.6 percent against the yen, before paring those increases in later trading. Oil prices climbed higher as Tuesday progressed — after an initial fall in the Asian morning — as a weaker dollar offset some of the concerns around demand destruction. Other key data expected later this week includes US retail sales and industrial production on Thursday; China home and retail sales as well as industrial production on Friday; and Euro area CPI, also on Friday.