ProMASS News Bureau: Jan 28, 2016:
Asian share markets slipped today after a late selloff on Wall Street, as investors were concerned the US Federal Reserve might continue raising rates despite a turbulent backdrop for financial markets and much of the global economy.
MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.5 per cent in the wake of the Wall Street drop, while Australia’s main index lost 0.6 percent. Japan’s Nikkei fell 0.96 per cent, after a 2.7 per cent jump the day before. The blame for Wall Street’s fall was laid at the door of the Federal Reserve.
However, US Federal Reserve has kept key interest rate unchanged and pledged to closely monitor developments in the global economy and financial markets. The Fed said yesterday that economic growth has slowed since it raised rates from record lows in December.
For seven years until December, the Fed had kept that rate at record lows near zero. The latest Fed’s statement comes against a more perilous global backdrop. Since the Fed raised rates on 16th December last year, stock markets have plunged, oil prices have skidded and China has struggled to manage a slowdown in the world’s second-biggest economy. The Fed’s latest statement, issued after a two-day meeting, included no specific timetable for rate increases. But the changes it made in describing current economic conditions. While the December statement said the economy was expanding at a “moderate pace,” now it has said that “economic growth slowed late last year.” The Fed’s decision was approved by a unanimous vote of 10-0.
