Fed rate cut, trade, oil and currencies in the spotlight

Asian markets edged up on Thursday after gains on Wall Street, as investors are now more confident that the US Federal Reserve could cut interest rates this year to support an economy affected by the ongoing trade war.

In Japan, the Nikkei 225 rose slightly to 20,789.14 while the Topix index lost 0.18%.

The Australian ASX 200 benchmark rose 0.35% as most sectors advanced. The heavily weighted financial sub-index was up 0.21%, as a result of the growth in major banking stocks.

Markets in South Korea are closed for a public holiday.

Analysts said markets were already starting to look into the possibility of rate cuts after Fed Chairman Jerome Powell said the US central bank would keep an eye on the national economy and make the needed to "support growth".

"US markets have strengthened slightly overnight by anticipating rate cuts and announcing that President (Donald) Trump wants an agreement with Mexico, although little progress has been made," analysts said. ANZ Research in a morning note.

The United States and Mexico have failed to reach an agreement on immigration issues at a meeting on Wednesday, just days before the entry into force of the 5% tariffs on all Mexican imports. Trump announced these rights in a surprise tweet last week, saying that they would be taxed "until illegal migrants arriving through Mexico and in our country, STOP."

In the currency market, the USdollar index, which measures the greenback versus a basket of its competitors, traded for the last time at 97.32, lower than the value of 98, 00 reached the previous week.

The Japanese yen, considered a safe haven asset, traded at 108.27 for a dollar, strengthening from near 109.90 levels last week. Meanwhile, the Australian dollar has changed hands at 0.6972 USD from nearly 0.6920 USD before.

Oil prices dropped overnight, following an unexpected rise in crude oil inventories in the United States. US futures contracts fell 3.4% to $ 51.68 per barrel, while Brent, the international benchmark, fell 2.2% to $ 60.63.

Crude inventories rose 6.8 million barrels, while analysts expected a draw of 849,000 barrels, Reuters reported.