Finance

FTSE 100 Slips As Fed Increases Interest Rates

FTSE 100 Slips As Fed Increases Interest Rates

The US market closed mixed on US Federal Reserve decision.

U.S Federal Reserve has hiked interest rates by 25 basis points in line with the market speculations.

Fed futures markets now put the chances for another rate increase this year to below 50 per cent.

The vote in favor of the hike was unanimous.

Since the financial crisis as the Fed has bought government and mortgage-backed bonds to underpin the American economy, but policymakers have confirmed that they will start to reduce reinvesment of bonds as they mature. She noted that-among other things-stabilization in the labor force participation rate is signaling a stronger jobs market.

Joseph Gagnon, senior fellow at the Peterson Institute for International Economics and former visiting associate director of the Division of Monetary Affairs at the US Federal Reserve Board, told Radio Sputnik that rates will remain relatively low for some time despite the rate hike.

The U.S. central bank on Wednesday raised the benchmark interest rates for the fourth time since December 2015, and unveiled plans to start trimming its balance sheet.

However a low unemployment rate upheld the bank's decision, with Federal Reserve Chair Janet Yellen saying: "Our decision ... reflects the progress the economy has made and is expected to make".

President Trump's approval rating hits 50 percent, poll shows
The same poll found that only 50 percent of whites without a college degree approve of the job the president is doing. And, while Republicans are more dissatisfied than ever since Trump took office, Democrats are even more concerned.

Germany's DAX fell 0.9 percent to 12,690 while the CAC40 of France sank 1.1 percent to 5,188.

CURRENCIES: The pound rose nearly a cent, from $1.2695 to $1.2781, after the Bank of England's statement - currencies tend to rise when rates increase.

Outside of the labor market, the data flow for the US - including another soft USA core Consumer Price Index (CPI) inflation report this morning - had been surprising on the downside.

This is the second interest rate rise in three months, and most analysts expect that the Fed will increase rates once more this year. The FTSE 100 of Britain dropped 0.4 percent to 7,474.40. USA employers continue to add jobs at a steady rate.

It means the USA central bank is scaling back its support for the economy as it continues to recover and grow.

The Fed has a mandate to keep the country at full employment and make sure inflation does not rise or fall too much. "That is the main reason why the dollar is remaining supported for now", said Manuel Oliveri, currency strategist at Credit Agricole in London.

The dollar index was last down 0.06 per cent, while the euro remained unchanged at $1.1214.

Brent crude settled down 8 cents at $46.92 a barrel, while US crude settled down 27 cents at $44.46, after touching a six-month low of $44.32 a barrel.


  • Official London Grenfell fire toll at 79, say police

    Official London Grenfell fire toll at 79, say police

    British health authorities will also provide long-term bereavement counselling for those who lost loved ones in the tragedy.

    Presumed death toll in London tower blaze rises to 79

    The 91-year-old monarch said it is "difficult to escape a very somber mood" on what is normally a day of celebration. Londoners and others have also donated huge amounts of food, water and clothing, and shelter, to survivors.
    Cavaliers vs. Warriors, Game 3

    Cavaliers vs. Warriors, Game 3

    Broke the record of 14 straight postseason wins held by the NHL's Pittsburgh Penguins, who did it twice. Including the loss in Game 3 , Cleveland is 3-7 SU and ATS in its last 10 games as a home underdog.
  • Next-Gen Mercedes A-Class Hits the Nurburgring for Testing

    Next-Gen Mercedes A-Class Hits the Nurburgring for Testing

    Well, it seems the time is now coming as Mercedes has been preparing its dealers for the arrival of the all-new A-Class next year. It will slot below the CLA-Class sedan, which carries "coupe-like" styling and is now the smallest Mercedes on sale in the US.

    Britain Kicks Off Brexit Talks With European Union

    British foreign minister Boris Johnson , like Davis a prominent backer of the leave campaign, also sounded an upbeat note. The election left an image of a dysfunctional Britain coming up against a well-oiled European Union negotiating machine.
    Rob Kardashian, Blac Chyna Celebrate Father's Day With Dream

    Rob Kardashian, Blac Chyna Celebrate Father's Day With Dream

    The former couple documented their fun-filled day on social media, each posting photos to Instagram and Snapchat . The stars looked happy posing with Mickey and Minnie Mouse, and Chyna even sported her own pink mouse ears.
  • Vegas holds trade cards during expansion draft window

    It also is another team-first act in a career full of them. "For me, it was an opportunity to finish the season here". Goalies Philipp Grubauer of Washington or Antti Raanta of the Rangers seem to be prime candidates for such dealings.
    Official notification confirms results today, updates expected by 3 pm

    Official notification confirms results today, updates expected by 3 pm

    NEET was conducted for 65,000 MBBS and 25,000 BDS seats in medical and dental colleges across the country, NDTV reported. The result declaration information was announced on the official results portal of Government of India.
    Leo Varadkar set to become Taoiseach

    Leo Varadkar set to become Taoiseach

    Paying tribute to Mr Kenny, Mr Varadkar said: "I have no doubt, only for him, this country as we know it would not be here today". Once nominated, Mr Varadkar will travel to Aras an Uachtarain (President's residence) to meet President Michael D.
  • Officer who shot Philando Castile testifies

    Officer who shot Philando Castile testifies

    Once he saw Castile's hand on the gun, Dutton explained that de-escalating the situation was no longer an option. He testified that he saw Castile reaching for his gun and was forced to fire on him who did not obey his orders.

    Tech CEOS visit White House to talk modernizing government

    Many business executives are eager to work with the new administration as they face numerous regulatory and other policy issues. Others, including Oracle chief executive Safra Catz and Palantir co-founder Peter Thiel, praised Trump effusively.

    Celtics Trade No. 1 Overall Draft Pick To 76ers

    Philadelphia big men Joel Embiid and Dario Saric posted a selfie from the team's locker room with Fultz's name in the background. The Cavs did not know when they drafted Wiggins that LeBron James would return, presenting Cleveland with a win-now scenario.