Longer-dated US Treasury yields and the dollar have risen in Asia after the Federal Reserve shifted its policy framework to place more emphasis on boosting economic growth and less on worries about letting inflation run too high.

The 10-year Treasury yield on Friday rose to 0.7870 per cent, the highest since June 10, which caused the yield curve to steepen, reflecting the Fed’s tolerance for higher inflation.

The dollar hit a two-week high against the yen but held steady against most other major currencies. Gold prices erased early gains and edged higher.

MSCI’s broadest index of Asia-Pacific shares outside Japan bounced between gains and losses in choppy trade. US stock futures rose 0.25 per cent.

Australian stocks fell 0.85 per cent. Shares in China rose 0.33 per cent, while Tokyo stocks gained 0.16 per cent.

Oil futures fell due to easing concern about the impact of a hurricane that struck the centre of the US oil industry.

Markets swirled after Fed chairman Jerome Powell laid out a policy that aims for two per cent inflation on average so too low a pace would be followed by an effort to lift inflation “moderately above two per cent for some time”.

Powell’s comments were widely expected but some traders in Asia were disappointed the Fed did not reveal more details about how the new framework will work or provide any clues to what it will do at its next policy meeting.

“Average inflation had been talked up quite a bit, so we knew this was coming,” said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities in Tokyo.

“But Powell really didn’t reveal much beyond that. Some people who were expecting a clearer steer on policy or some kind of cap on bond yields are left disappointed.”

Dallas Fed President Robert Kaplan later said the new policy framework was not a commitment to future action, which contributed to confusion about how it will work, Daiwa’s Ishizuki said.

On Wall Street, the Dow Jones Industrial Average rose 0.57 per cent, the S&P 500 gained 0.17 per cent, both setting new intraday highs.

The Nasdaq Composite dropped 0.34 per cent.

Stocks also rose on news that Abbott Laboratories won US marketing authorisation for a COVID-19 portable antigen test that can deliver results in 15 minutes and will sell for $US5. Abbott’s shares rose 7.9 per cent.

The greenback rose against the yen but weakened slightly against the Australian dollar, the British pound and the yuan.

Spot gold advanced 0.32 per cent to $US1,935.07 as traders considered the Fed’s new stance on inflation.

US crude futures fell 0.1 per cent to $US42.98 a barrel. Brent crude futures fell to $US45.07 a barrel after US refiners avoided the worst of a storm that struck the US Gulf Coast.