Asian shares were broadly upbeat, while the dollar edged lower Thursday as investors nervously awaited the US Federal Reserve’s annual Jackson Hole meeting for clues on future interest rate hikes.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3% after US shares edged higher in the previous session.

Australian shares rose 0.7%, Japan’s Nikkei added 0.52%, and China’s CSI 300 gained 0.27%. The Fed’s annual monetary policy meeting in Jackson Hole, Wyoming, is scheduled to begin on Friday.

NAB economics director Tapas Strickland said investors now expect the federal funds rate to peak at 3.8% in March 2023, up from 3.62% two weeks ago.

Interest rate futures imply a 60% chance of a 75bps rate hike by the Fed in September. In early Asian trade, the yield on the benchmark 10-year US Treasury note rose to 3.1095%, compared with a US close of 3.106% on Wednesday.

Two-year Treasury yields rose as traders expected the federal funds rate to rise to 3.4028%, compared with a US close of 3.386%. Yields also rose overnight, but that didn’t stop US stocks from rising Wednesday. The Dow Jones Industrial Average closed up 0.18%, the S&P 500 gained 0.29%, and the Nasdaq Composite added 0.41%.

USD/JPY edged down 0.01% to 137.09. Still some distance from this year’s high of 139.39 set in mid-July. The European single currency was flat at $0.9968 in early Asian trade, down 2.45% in a month.

The US dollar index, which tracks the greenback against a basket of other major trading partners, edged lower in Asia to 108.51. US crude was up 0.38% at $95.25 a barrel. Brent crude rose 0.5% to $101.22 a barrel. Gold edged higher, with spot gold trading at $1,752.96 an ounce.