Asia-Pacific markets set to climb as Fed holds rates and shifts dot plot

Asia-Pacific markets were set to climb on Thursday after the U.S. Federal Reserve held the Federal Funds rate at 5.25% to 5.5%, and shifted its "dot plot" to only project one rate cut this year.

This was down from the three cuts projected in its March meeting, although the dot plot also indicated a more aggressive cutting path for 2025. Four rate cuts totaling a full percentage point are anticipated, up from three.

In Asia-Pacific, Australia's S&P/ASX 200 stood at 7,782, higher than the index's last close of 7,715.5.

Japan's Nikkei 225 futures also pointed to a stronger open for the market, with the futures contract in Chicago at 39,165 and its counterpart in Osaka at 39,200 compared to the previous close of 38,876.71.

Hong Kong Hang Seng index futures were at 18,035, higher than the HSI's last close of 17,937.84.

The Fed's post-meeting statement said "inflation has eased over the past year but remains elevated," echoing language from the last statement.

However, the new statement also said, "In recent months, there has been modest further progress toward the Committee's 2 percent inflation objective."

The previous language said there had been "a lack of further progress" on inflation.

Separately, inflation in May remained unchanged from April, rising 3.3% year-on-year and remaining flat on aa month-on-month basis.

Overnight in the U.S., all three major indexes rose in response to the Fed's decision and May inflation reading.

The S&P 500 jumped to a record and closed above 5,400 for the first time.

The broader market index climbed 0.85%, closing at 5,421.03, while the Nasdaq Composite also gained 1.53% and hit a record high. In contrast, the Dow Jones Industrial Average slipped 0.09%.

— CNBC's Lisa Kailai Han, Pia Singh and Jeff Cox contributed to this report.