The possibility of another Federal Reserve interest rate hike has dented market optimism – Copyright AFP Nhac NGUYEN
Asian investors took fright Thursday at a forecast-busting reading on the US services sector that revived speculation the Federal Reserve could lift interest rates again, compounding a spike in oil prices that has fanned fresh inflation fears.
Wall Street dived and Treasury yields rose after the release of the Institute of Supply Management figures, which dealt a blow to hopes the US central bank had reached the end of its tightening cycle following a string of recent positive data.
The reading put further upward pressure on the dollar, with the yen particularly in focus as it sat at its weakest point for 10 months — when Japanese officials intervened in money markets last year to prop it up.
After a rosy couple of weeks, the gloom that has characterised markets for much of the summer h