Asian markets make solid gains following global rout

Asian markets made solid gains on Wednesday, with Japanese shares reversing early losses after a central bank official played down the prospect of immediate interest rate hikes.

Asian markets made solid gains on Wednesday, with Japanese shares reversing early losses after a central bank official played down the prospect of an immediate hike in interest rates. The benchmark Nikkei 225 gained 3%, bouncing back from losses of 2.5% earlier in the session, following fresh comments from Shinichi Uchida, deputy governor of the Bank of Japan (BOJ). Elsewhere in Asia, South Korea’s Kospi gained 2.4%, while Hong Kong’s Hang Seng index was 1.3% higher. Taiwan’s Taiex was up 3.8%. The gains follow days of volatility, which saw the Nikkei suffering on Monday its biggest daily loss since 1987. According to Reuters, Uchida said the intense market volatility over the past week could “obviously” change the BOJ’s rate hike path, if it affects the central bank’s economic and inflation projections. “We won’t raise interest rates when financial markets are unstable,” he was quoted as saying in a speech to executives in the northern Japanese city of Hakodate. “As we’re seeing sharp volatility in domestic and overseas financial markets, it’s necessary to maintain current levels of monetary easing for the time being.” Uchida’s comments contrast with the hawkish tone struck by the BOJ in recent weeks, which have forced many market participants to unwind their yen carry trades, a widely employed investment strategy.