Markets fell in Asia and Europe after the US Federal Reserve cut interest rates for the first time since the financial crisis.
Asian stocks fell sharply on Friday after the US Federal Reserve cut interest rates for the first time since the financial crisis. The Fed’s move to cut rates by 0.25% was widely expected, but markets had been expecting a more aggressive reduction of 0.50%. The Nikkei 225 index fell 1.8%, while Hong Kong’s Hang Seng index dropped 2.2%. European markets followed suit, with London’s FTSE 100 falling 1.4% and Germany’s DAX dropping 1.5%.
The Fed cited a slowdown in global growth as one of its reasons for cutting rates, saying it was “monitoring developments abroad”. This is likely to have spooked investors, who are concerned about a slowing Chinese economy and an escalating trade war between China and the US.
