On the domestic front, Destry Damayanti was sworn in as governor of Bank Indonesia on Wednesday, becoming the first woman to lead the central bank. During her confirmation hearing, she pledged to keep monetary policy agile in responding to economic challenges, while prioritizing stability and fostering growth.

Upside momentum was limited, however, by concerns that both headline and core inflation could edge higher in the coming months. These worries stem from rising input and logistics costs, a rebound in energy prices, and potential El Niño-related disruptions to food supply.

All sectors advanced, led by basic materials, non-cyclical stocks, and energy. Early notable gainers included Charoen Pokphand (up 7.6%), Adaro Andalan (4.0%), Bukit Asam (3.7%), and Medco Energi (2.1%).

While the RBNZ signaled that further rate hikes may still be needed, its forward guidance was seen as more cautious than markets had expected, prompting a sharp selloff in the kiwi. Governor Anna Breman also emphasized that there is no predetermined path for monetary policy and that the timing of any additional rate increases remains highly uncertain.

At the same time, Bank of Japan board member Hajime Takata on Wednesday opened the door to larger-than-usual or consecutive interest rate hikes to rein in mounting inflationary pressures. BOJ Governor Kazuo Ueda also remarked on Tuesday that policymakers must pay closer attention to upside risks to prices when setting monetary policy, signaling that a rate increase is likely later this month.

Over the first eight months of 2026, total industrial production was up 11.4% compared with the same period a year earlier, representing the strongest growth for this timeframe in many years. On a monthly basis, industrial output rose 1.2%.

Imports surged 37.9% year-on-year to USD 54.91 billion, while exports increased 26% to USD 54.8 billion. Over the first eight months of the year, the country recorded a cumulative trade deficit of USD 20.46 billion. During this period, exports rose 22.4% to USD 374.84 billion, whereas imports climbed 35.3% to USD 395.30 billion.

Even so, markets are still pricing in roughly a two-thirds probability of a Fed rate increase later this month, following Chair Kevin Warsh’s hawkish remarks on Friday. Investors are now awaiting the latest weekly jobless claims figures on Thursday and Friday’s August nonfarm payrolls report for additional clarity on the strength of the US labor market. Elsewhere, oil prices paused their recent rally after President Donald Trump suggested that the latest attacks on Iran would be short-lived, helping to temper inflation concerns.

Employment rose for the fourth consecutive month, marking the longest period of job creation in more than five and a half years. At the same time, input cost inflation picked up but remained relatively mild, while prices charged for goods and services increased at their slowest rate since January, pointing to only limited pass-through of higher input costs to final prices.

Sentiment was further buoyed after President Donald Trump said that any renewed US military action against Iran would likely be short-lived, alleviating fears of a prolonged conflict in the Middle East. Softer oil prices also helped reduce inflation concerns and pressure from rising energy costs.

Technology and financial stocks posted gains, lending broader support to the market. By contrast, Shein remained under pressure, with its shares sliding more than 5% on Wednesday to HK$46 in their second day of trading in Hong Kong.

Among notable movers, Tencent rose 0.4%, Lenovo 1.1%, MiniMax 1.0%, Akeso 3.0%, and AIA 1.8%.

At the same time, recent figures showed the economy performed better than expected in the second quarter, reinforcing expectations that the Reserve Bank of Australia could resume tightening after raising rates three times already this year. Following the GDP release, markets lifted the probability of a rate increase this month to 58%, up from 49%, while a move in the cash rate to 4.60% by November is now fully priced in. The increasingly hawkish policy outlook has been further supported by renewed fighting in the Gulf, which pushed oil prices higher and stoked fresh concerns about inflation.

At the same time, stronger-than-expected Q2 GDP figures reinforced expectations that the Reserve Bank will raise interest rates at its meeting later this month. Among major stocks, the big four banks rose between 0.5% and 1.5%, while PLS Group climbed 3.0%, Fortescue added 2.7%, and Orica advanced 2.2%. In contrast, heavyweight BHP Group slipped 1.1%.

A private survey showed the composite PMI climbed to 52.1 in August from 50.8, supported by stronger growth in both services and manufacturing. The services PMI increased to 51.4 from 50.4, while the manufacturing PMI rose to 51.5 from 50.9.

These figures followed official data indicating that the composite PMI edged up to 49.5 from 49.3. Within that, manufacturing activity improved to 49.8 from 49.2, while the non-manufacturing index was unchanged at 49.

Sentiment was also aided by geopolitical developments, after US President Donald Trump moved to ease concerns about a wider conflict with Iran, suggesting that any renewed hostilities would likely remain contained.

Notable gainers in the session included Foxconn Industrial Internet (up 1.9%), SMIC (1.2%), Eoptolink Technology (1.7%), and Weichai Power (2.2%).

Both readings are measured against the same months a year earlier, indicating that Vietnam’s industrial sector continues to expand at a strong pace despite the slight moderation. The July figure reflects the change relative to July of the previous year, while the August result compares production levels with August a year earlier.

The near-steady performance suggests underlying resilience in the country’s manufacturing and industrial base, with only a minimal deceleration between July and August on a year-over-year basis.

Both readings are based on year-over-year comparisons, with the August figure measuring price changes against August a year earlier and the July figure comparing prices to the same month in the prior year. The acceleration suggests that price pressures in the Vietnamese economy strengthened further as the third quarter progressed. Investors and policymakers will be watching upcoming data closely to gauge whether this upward trend in inflation persists in the months ahead.

Growth was driven primarily by domestic demand. Foreign new business increased for the fourth consecutive month, but the expansion in external sales was more subdued than in July. Employment also rose for the fourth straight month, marking the longest run of job creation since 2023.

On the price front, input cost inflation picked up, reflecting higher labor, raw material, oil, and diesel costs. Output charges increased for a third successive month, the longest stretch of output price inflation in the sector since the first half of 2024. However, the rate of selling price inflation was unchanged from July and remained only marginal.

Imports of intermediate and other merchandise goods fell sharply, down 7.8% to AUD 18.28 billion. This was driven by reduced purchases of fuels and lubricants (-12.3%), processed industrial supplies n.e.s. (-4.7%), and other parts for capital goods (-1.7%). Imports of non-monetary gold also slumped, dropping 31.1% to AUD 1.65 billion.

In contrast, capital goods imports rose 6.7% to AUD 10.74 billion, supported by strong increases in ADP equipment (50.4%), industrial transport equipment (7.6%), and civil aircraft and confidentialised items (16.6%).

Meanwhile, imports of consumption goods increased 3.5% to AUD 13.67 billion, driven by higher purchases of non-industrial transport equipment (8.2%), food and beverages mainly for consumption (3.6%), and consumption goods n.e.s. (2.8%).

Technology shares led the advance, with Samsung Electronics and SK hynix each adding more than 1%. Other notable gainers included SK Square (1.0%), Hyundai Motor (1.3%), LG Energy Solution (6.3%), KB Financial Group (5.8%), Hanwha Aerospace (2.4%), Doosan Enerbility (3.0%), Shinhan Financial Group (3.8%), and HD Hyundai Heavy Industries (2.7%).

Upside momentum was capped, however, by renewed worries over possible US tariffs on semiconductors, after Commerce Secretary Howard Lutnick said the administration is weighing a targeted approach that would link tariff relief to investment in US chip manufacturing.

The move from 50.4 to 51.4 signals a firmer pace of growth in services activity, as readings above 50 indicate expansion. The improvement suggests that service-oriented businesses in China gained momentum over the month, building on the marginal growth recorded in July 2026.

The latest August reading at 51.4 underscores a gradual strengthening in the sector’s performance, offering a mildly more positive signal for the broader economy compared with the prior month’s near-flat expansion.

Imports fell 2.5% month-on-month to AUD 44.34 billion, reversing an upwardly revised 0.7% decrease in June. The drop was largely driven by reduced imports of fuel and lubricants, reflecting subdued domestic demand. Exports decreased 3.3% month-on-month to AUD 46.26 billion in July, following a downwardly revised 9.1% surge in June. The fall in exports was mainly attributable to lower shipments of non-monetary gold.

The moderation in the surplus suggests a cooling in external demand or relatively stronger import activity compared with the previous month. While Australia continues to post a positive trade balance, the July reading points to a less robust contribution from net exports compared with June, a factor investors and policymakers will watch closely in assessing momentum in the country’s growth outlook.

Market participants are likely to scrutinize upcoming data releases to determine whether July marks the beginning of a broader trend toward a smaller surplus, or a temporary pause following stronger trade performance earlier in the year.

On a month-over-month basis, the July reading reflects a steeper contraction than in the prior month, when imports were nearly flat. The comparison framework shows that while June’s -0.2% change represented a marginal pullback from May, July’s -2.5% result marks a more pronounced reduction in import volumes or values versus June.

The deeper decline in July suggests a cooling in Australian demand for foreign goods and services compared with the previous month. Market participants and policymakers are likely to monitor upcoming data to assess whether this marks the start of a sustained downtrend in external demand or a short-lived adjustment in trade flows.

The figures are presented on a month-over-month basis, meaning July’s -3.3% result compares the change in exports from June to July, while the previous 9.1% reading reflected the change from May to June. The swift shift from strong growth to contraction suggests increased volatility in Australia’s export sector heading into the second half of 2026, a development that will be closely watched by markets and policymakers sensitive to trade-driven impacts on overall economic activity.