HONG KONG, Aug 8, 2022 (BSS/AFP) - Asian markets struggled Monday and the

dollar held big gains as a blockbuster US jobs report ramped up bets that the
Federal Reserve will announce more sharp interest rate hikes as it tries to
tame runaway inflation.

While the employment reading -- which was more than twice as high as expected
-- indicated the world's top economy remained resilient despite rising prices
and borrowing costs, it will complicate the bank's plans to tighten monetary
policy.

Traders have hoped that with several indicators pointing to a slowdown,
including GDP figures showing a technical recession, policymakers could begin
to ease back on their pace of rate hikes.

Now, speculation is growing that the Fed will have to announce a third
successive 75 basis-point increase next month, particularly as officials have
said their decisions will be data-dependent.

"Friday's payroll report indicates an overheated labour market that continues
to tighten further," said SPI Asset Management's Stephen Innes.

"Hence at minimum, the markets expect another 100 basis points of Fed funds
rate increases over the next three meetings... with risks skewed towards
significant increases."

All eyes are now on the release this week of US July inflation data, which is
expected to show a slight slowdown from June but still at four-decade highs.

The "report seems very unlikely to offer 'compelling evidence' of a slowdown
needed for the Fed to pull away from its aggressive inflation-fighting mode."
Innes added.

The jobs figures left Wall Street's main indexes mixed Friday, and Asia
followed suit with markets fluctuating in early trade.

However, there was some relief that tensions had calmed since Nancy Pelosi's
visit to Taiwan last week sparked a furious reaction from China that saw it
conduct days of live-fire military drills around the island.

Hong Kong dipped along with Sydney, Seoul, Singapore, Taipei, Manila, Jakarta
and Wellington.

Tokyo edged up and Shanghai was flat, with better-than-expected Chinese trade
data offset by fresh worries about Covid lockdowns in the country that
threaten the economic recovery.

The prospect of higher interest rates sent the dollar surging, and it held on
to those gains in Asia.

Bets on a recession across leading economies continued to weigh on oil prices
as investors worry about the impact on demand -- figures last week indicated
Americans were driving less now than in summer 2020 at the height of the
pandemic.

A rise in US stockpiles was partly responsible for a 10 percent drop in the
commodity last week, pushing WTI below $90 for the first time since February.

Both main contracts have lost all the gains seen in the wake of Vladimir
Putin's invasion of Ukraine, which led the United States and Europe to ban
imports of Russian crude, hammering already thin supplies.

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: UP 0.2 percent at 28,241.09 (break)

Hong Kong - Hang Seng Index: DOWN 0.6 percent at 20,072.68

Shanghai - Composite: FLAT at 3,227.00

Euro/dollar: DOWN at $1.0181 from $1.0184 Friday

Pound/dollar: DOWN at $1.2071 from $1.2075

Euro/pound: UP at 84.35 pence from 84.32 pence

Dollar/yen: UP at 135.32 yen from 135.00 yen

West Texas Intermediate: DOWN 0.2 percent at $88.87 per barrel

Brent North Sea crude: DOWN 0.3 percent at $94.68 per barrel

New York - Dow: UP 0.2 percent at 32,803.47 (close)

London - FTSE 100: DOWN 0.1 percent at 7,439.74 (close)