Fed raises interest by 0.25 points

The Fed also surprised markets with a forecast that showed it could raise rates three times next year, instead of two. His promises of higher spending and big cuts in corporate and personal taxes have led to significant gains in stockmarkets and the USA dollar and fuelled market expectations of higher inflation and interest rates.

Trump, critical of Yellen during the campaign and considered likely to replace her when her term ends in early 2018, had not by late afternoon issued any comment about the Fed’s rate decision, in line with his predecessors’ practice.

The Fed’s move Wednesday, only the second rate hike in the past decade, came on a unanimous 10-0 vote.

It’s hardly guaranteed that the Fed’s forecast for three hikes in 2017 will prove accurate.

Shanghai lost 0.7 percent as traders fret about further outflows of cash, with China’s foreign exchange reserves already being hammered by attempts to support the yuan which is sitting at an eight-year low against the dollar. It turns out it’s raising them just once.

TD Bank and Royal Bank have both hiked their fixed mortgage rates, anywhere from 0.05 percentage points to 0.4 percentage points in recent weeks. The Fed’s move now shifts the focus from central bank policy to economic growth as the driver of stock market performance.

“With the U.S. interest rates now rising, it’s expected that some of the estimated US$130 billion of capital inflow into Hong Kong since 2008 will be exchanged back to the United States dollar”, Chan said. The worry is that traditional bond investors who had defected to dividend stocks will return to bonds now that yields are rising again.

Mr Giddy was among those sceptical of the forecast for three U.S. rate rises in 2017, saying that they would be off the table in the event of any major financial dislocation.

Fed Chair Janet Yellen also cited an improving labor market and evidence of faster inflation for its 2017 rate outlook.

While Yellen stressed that the Fed is granted independence by Congress to pursue the dual objectives of maintaining maximum employment and stable prices, she said financial regulation is an area of possible coordination.

“Canadian bond yields are tightly linked to USA yields”, he said. Nine of 17 said they viewed trade policy as a potential headwind, while five cited fiscal policy as the biggest risk and another two said a stronger dollar could up-end the outlook.

“Given that (gold) prices have now crumbled, it remains to be seen if we reach our downside target of $1,125”, INTL FCStone analyst Edward Meir said in a note.

Hertz Global Holdings fell $2.09, or 8.3 percent, to $23.04 after the struggling vehicle rental company named a new chief executive officer. The euro was up 0.3 percent at $1.0441 while the dollar fell 0.1 percent to 118.17 yen.

The Trump administration promises to boost this annual growth rate back to 3-4 per cent.