Asian stocks rose after the Federal Reserve pared back expectations for interest-rate increases this year.

The MSCI Asia Pacific Index gained 1.1 percent to 127.54 as of 9 a.m. in Tokyo, with material and consumer shares leading the advance. The Fed’s signal that borrowing costs won’t rise as fast as officials previously forecast propelled U.S. stocks to their highest level this year. Japanese shares climbed even after guidance from the U.S. central bank helped strengthen the yen on Wednesday.

Fed officials kept the target range for the benchmark federal funds rate unchanged at 0.25 percent to 0.5 percent, citing the potential impact from weaker global growth and financial-market turmoil on the U.S. economy. The median of policy makers’ updated quarterly projections saw the rate at 0.875 percent at the end of 2016, implying two quarter-point increases this year, down from four forecast in December.

The MSCI Asia Pacific gauge is up 13 percent from this year’s low last month after commodity producers and financial shares rallied. The Bank of Japan refrained from expanding monetary policy this month, while the European Central Bank boosted an already unprecedented stimulus package.

Source: Bloomberg