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Stock market carnage as the ASX falls 2% after the US Fed raises rates by 0.75%
- The Australian stock market’s S&P/ASX200 plunged 2.11 percent in the first 30 minutes
- This happened after the US Federal Reserve’s 0.75 percentage point rate hike
The Australian stock market has plummeted after the US Federal Reserve raised interest rates by a whopping 0.75 percentage point.
The benchmark S&P/ASX200 plunged 2.11 percent in the first half of trading Thursday, falling to 6,840.4 points.
Mining giant BHP plunged 2.83 percent to $38.13 while Commonwealth Bank fell 1.64 percent to $104.23 at 10:30 a.m. Sydney time.
The Australian Securities Exchange has so far underperformed the US Dow Jones Industrial Average, which weakened 1.55 percent.
Australia’s stock market has plummeted after the US Federal Reserve hiked interest rates by 0.75 percentage point (Pictured is the Australian Securities Exchange in Sydney)
Global stock markets have plummeted after the US Federal Reserve raised the Federal Funds rate by 75 basis points overnight to a 14-year high of 3.75 percent to 4 percent.
The latest U.S. rate hike was three times the Reserve Bank of Australia’s gain of 25 basis points on Nov. 1, pushing the spot rate to a nine-year high of 2.85 percent.
The US Fed’s Federal Open Market Committee said it is “very vigilant about inflation risks.”
The statement from Wednesday evening, Australian time, mentioned the word ‘inflation’ nine times.
Global stock markets plunged after the US Federal Reserve raised the Federal Funds rate by 75 basis points overnight to a 14-year high of 3.75 percent to 4 percent (pictured is a New York Stock Exchange trader on Nov. 2 while US Federal Reserve Chairman Jerome Powell announces rate hike)
“Inflation remains high, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices and broader price pressures,” it said.
“Russia’s war against Ukraine is causing enormous human and economic problems.
“The war and related events are putting additional upward pressure on inflation and weighing on global economic activity.”
The US inflation rate of 8.2 percent in September was high for nearly four decades, while Australia’s equivalent level of 7.3 percent was the highest in 32 years.