Markets on edge as US Fed meets to tackle high inflation
Market expectations for a 25-basis-point rate hike rose sharply after data showed US annual inflation remained well above the Fed’s target.
The US Federal Reserve convened on Tuesday, with financial markets anticipating a potential interest rate hike to combat high inflation. Brent crude futures surged close to US$110 per barrel and US diesel prices hit a record high of nearly US$6.27 per gallon, heightening pressure on President Donald Trump as midterm elections loomed.
The yield on the 10-year US Treasury note soared to 5.03%, echoing levels from 2007 just prior to the global financial crisis, reflecting investor expectations of a rate increase. Market sentiment was dominated by concerns over persistently high consumer prices and the impact of artificial intelligence, causing Wall Street indices to slide.
If the Fed raises rates, it would mark the first increase since 2023, potentially angering Trump who has urged the central bank to lower rates to stimulate economic growth.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
