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(Bloomberg) — Asian stocks were mixed and U.S. equity futures wavered Monday after a Federal Reserve official flagged the possibility of sharper interest-rate increases and Chinese data signaled slower growth. 

Shares rose in Japan but dipped in Australia and fluctuated in Hong Kong. The latter’s trading session is truncated due to the Lunar New Year holiday, while China is among bourses that are closed.

Fed Atlanta branch president Raphael Bostic told the Financial Times that a 50 basis-point rate increase, or hikes at each policy meeting this year, are options to fight inflation. But he said three quarter-point moves starting March are the most likely 2022 outcome. Bostic doesn’t vote on policy this year.

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The Fed’s hawkish pivot to fight inflation and an uneven company earnings season have contributed to intense market volatility. 

The dollar held recent gains. Shorter-maturity Treasuries sensitive to the rate outlook declined and the yield curve flattened. Bond investors are braced for more swings as the Fed and other central banks curb pandemic-era stimulus. 

Monetary-policy decisions from the European Central Bank and Bank of England will help shape the market mood in the days ahead, as will profit reports from the likes of Alphabet Inc. and Meta Platforms Inc.

Some strategists argue global stocks are due for a steadier period, even if only temporarily, after shedding more than 6% in January. In the futures market, for instance, some speculative S&P 500 bets are the most bullish since 2018.

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The equity selloff “marks a long overdue correction rather than the start of a bear market,” BCA Research Inc. analysts including Peter Berezin and Melanie Kermadjian wrote in a note. “Stocks often suffer a period of indigestion when bond yields rise suddenly, but usually bounce back as long as yields do not move into economically restrictive territory,” they added.

High Five

Goldman Sachs Group Inc.’s economists now predict the Fed will lift its near zero benchmark by 25 basis points five times this year rather than on four occasions. That would take it to 1.25%-1.5% by the end of the year.

In China, the economy continued to slow at the start of the year, with manufacturing output slipping and Covid outbreaks hitting consumer spending.

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Meanwhile, crude oil climbed, in part on the risk that any Russian invasion of Ukraine could roil energy flows. Gold extended a retreat. Bitcoin dropped to around $37,000, nursing a drop of some 20% since the start of 2022.

Various speculative bubbles are deflating without significantly affecting financial-market functioning or adversely impacting the economy, Ed Yardeni, president of Yardeni Research, wrote in a note. That reduces “the chances of a recession and a bear market in the S&P 500,” he said.

For more market analysis, read our MLIV blog.

What to watch this week:

Earnings are due from Alphabet, Amazon, Exxon Mobil, Ford Motor, Meta Platforms, Qualcomm, Sony, Spotify, UBS GroupEuro zone GDP growth data, MondaySan Francisco Fed President Mary Daly due to speak at event, MondayReserve Bank of Australia rate decision, TuesdayManufacturing PMIs, including euro zone, TuesdayOPEC+ meeting on output, WednesdayEuro zone CPI, WednesdayBank of England, European Central Bank rate decisions, ThursdayFed Board of Governors confirmation hearing, ThursdayU.S. factory orders, initial jobless claims, durable goods, ThursdayU.S. payrolls report for January, FridayWinter Olympics kick off in China, Russia’s President Vladimir Putin due to attend opening ceremony, Friday

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Some of the main moves in markets:

Stocks

S&P 500 futures fell 0.2% as of 10:46 a.m. in Tokyo. The S&P 500 rose 2.4%Nasdaq 100 futures declined 0.2%. The Nasdaq 100 rose 3.2%Japan’s Topix index rose 0.7%Australia’s S&P/ASX 200 index fell 0.4%Hong Kong’s Hang Seng index was steady

Currencies

The Bloomberg Dollar Spot Index was little changedThe euro was at $1.1151The Japanese yen was at 115.41 per dollarThe offshore yuan was at 6.3665 per dollar

Bonds

The yield on 10-year Treasuries rose two basis points to 1.79%Australia’s 10-year bond yield fell one basis point to 1.93%

Commodities

West Texas Intermediate crude rose 1.5% to $88.13 a barrelGold was at $1,788.96 an ounce, down 0.2%

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