Tokyo shares close lower ahead of Fed decision

Tokyo stocks closed lower for a fourth straight day on Wednesday in cautious trade ahead of a key US Federal Reserve decision, with expectations rising for a tougher rate hike. The benchmark Nikkei 225 index lost 1.14 per cent, or 303.70 points, to end at 26,326.16, while the broader Topix index fell 1.20 per cent, or 22.52 points, to 1,855.93.

Panic has swept through the global market since data on Friday showed US consumer prices are rising at their fastest pace in decades on surging energy and food costs caused by the Ukraine war and supply chain snarls.

Investors are now bracing for the Fed’s interest rate decision later on Wednesday as the central bank struggles to walk a fine line between reining in inflation and trying to keep the economy on track. “Bargain-hunting is limited ahead of the FOMC results and Fed Chairman Jerome Powell’s press conference,” Okasan Online Securities said in a note.

The dollar fetched 135.06 yen in Asia, against 135.33 yen in New York late Tuesday, reaching a new 24-year low.