Asia-Pacific markets rise ahead of Bank of Japan decision

Asia-Pacific markets rose Friday, tracking Wall Street gains as geopolitical concerns eased and investors looked ahead to the Bank of Japan’s decision.

The central bank is expected to hold rates at 0.75%, according to economists polled by Reuters.

HSBC said it expects the Bank of Japan’s next 25 basis point hike to come in July 2026, but warned that further yen depreciation could bring forward the timing and open the door to more rate increases.

The bank flagged April as a possible alternative, citing the release of the BOJ’s quarterly Outlook report and improved clarity on this year’s Shunto wage talks, with another 25 bps hike potentially following later in 2026.

Japan’s headline inflation rate in December slowed sharply to 2.1%, its lowest level since March 2022. Its core inflation rate came in at 2.4% on year, in line with analysts’ estimates.

Japan’s Nikkei 225 was 0.2% higher, while the Topix added 0.72%. South Korea’s Kospi rose 0.7%, while the small-cap Kosdaq was up 0.86%.

Some tech stocks in Asia fell after shares of California-based Intel plummeted 13% in after-hours U.S. trading on its soft guidance for the current quarter, despite posting fourth-quarter earnings beat Thursday. SoftBank Group was down over 4%, while Lasertec fell nearly 6%. Tokyo Electron declined over 1%. South Korea’s SK Hynix dipped 1%.

Hong Kong Hang Seng Index added 0.74%, while the CSI 300 advanced 0.12%.

Australia’s S&P/ASX 200 climbed 0.38%.