The Federal Reserve will deliver more interest rate hikes next year even as the economy slips towards a possible recession, Fed Chair Jerome Powell said on Wednesday, arguing that a higher cost would be paid if the U.S. central bank does not get a firmer grip on inflation.
A ninth interest rate hike in a row by the Bank of England looks to be a foregone conclusion on Thursday and investors will be looking for clues on how many more will be needed with the economy sliding into recession but inflation still above 10%.
The dollar was on the back foot on Thursday, even as the Federal Reserve kept to its hawkish rhetoric after raising rates by half a percentage point, as investors were doubtful over how much the central bank would commit to putting the brakes on growth to curb inflation.
Asian stocks sagged on Thursday, tracking declines on Wall Street, after the U.S. Federal Reserve projected higher interest rates for a longer period.
Chinese industrial production and retail sales read well below expectations in November, data showed on Thursday, as rising COVID-19 cases and increased restrictions to curb the virus weighed heavily on the economy.
Oil prices fell on Thursday as hawkish signals from the Federal Reserve brewed uncertainty over U.S. economic health and spurred some profit taking after a three-day rally, even as the outlook for demand improved.