Ten-year bond yields in Australia and South Korea dropped by seven basis points to 2.06 per cent and 1.53 per cent, respectively. In the general statement, the Fed expressed support for the United States economic situation, strengthening the belief that the Fed will indeed raise the interest rates in December.
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The Federal Open Market Committee made a decision to maintain its benchmark federal funds rate at 0.25-0.5%, pending signs of higher inflation and further strengthening of the labour market. Chances are now at 52%, according to CME Group fed funds futures, up from 48% before the announcement on Wednesday.
Investors who had waited in anticipation of the Fed’s decision felt comfortable to jump back into trading again yesterday, particularly in interest-rate sensitive stocks, said Mr. Yu.
BANK OF JAPAN: The Japanese central bank said it will hold its short-term policy rate at negative 0.1 percent and might cut it further. Overall, the median forecast for the midpoint of the target rate/range is around 0.625 percent by the end of 2016, down from 0.875 percent and 1.125 percent by the end of 2017, down from 1.625 percent.
The US dollar index, which tracks the greenback against a basket of six major rivals, was slightly higher at 95.456, on track to log a weekly loss of 0.7 per cent.
But a split in the Fed s policy body, with three of ten Federal Open Market Committee members arguing for a rate hike now, underscored the increasing hawkish drift of the body.
South Korean won, Chinese yuan and Japanese yen notes are seen on USA 100 dollar notes in this picture illustration December 15, 2015. While the Fed still sees a rate hike this year, its projection for increases next year was trimmed to two from three.
With oil prices rising for the second straight day thanks in part to a surprisingly large drop in US crude inventories, oil-linked currencies like the Canadian dollar, Colombian peso and Russian rouble all gained against the dollar. London’s FTSE 100 advanced 1.2 percent to 6,917.
KB BEAT: KB Home added 34 cents, or 2.3 percent, to $15.27 after the homebuilder disclosed strong results.
The sales bounce was mostly thanks to the recent acquisition of TNT Express, but FedEx also managed solid gains in its core businesses.
The European oil and gas index was up 1.2 percent, helped by a 1.3 to 1.5 percent rise in BP, Royal Dutch Shell and Tullow Oil.
In mainland Europe on Thursday, the CAC 40 index in Paris and the DAX 30 in Frankfurt both rose 2.3%. Low interest rates are still aiding the economic recovery and are not causing the economy to grow too fast. Brent crude, used to price worldwide oils, rose 89 cents, or 1.9 percent, to $46.77 a barrel in London.
In China, the Shanghai Composite ended up 0.5%, while the Hang Seng index in Hong Kong added 0.4%. Japanese markets were closed for a holiday.
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And perhaps most critical for some Fed officials, inflation has yet to make significant progress in rising toward the central bank’s 2 percent target range.
