Economic indicators, on which this week is a little bit light, are likely to drive the next move

Asian shares were pinned below 1-1/2 month highs on Tuesday as even a larger-than-expected interest rate cut in China failed to excite investors jaded at the lack of bigger stimulus measures.

China’s five-year loan prime rate was lowered by 25 basis points to 3.90%, bigger than the five to 15 bp cuts forecast by economists. The Shanghai Composite, however, fell 0.7% in early trade and blue chips fell 0.6%.

“It is a significant cut, showing policymakers are serious,” said OCBC foreign exchange strategist Christopher Wong, and ought to support currencies such as the Australian dollar.

“But it remains to be seen if it is sufficient to keep momentum sustained,” he said.

“Markets are still on the lookout for more fiscal support measures, in particular targeting consumption.”