Investing
Market slump continues as US Fed pushes on with QE taper
Japan’s Nikkei has dropped another 2.5% overnight as equity markets move further into the red following a fresh tapering announcement from the US Federal Reserve.
In its first unanimous decision since last June, the US central bank said it would pare back its stimulus programme by another $10bn in February, taking total month asset purchases down to $65bn.
A statement from the central bank made no mention of the recent slump seen in emerging markets – widely thought to have been prompted by its initial decision to taper – and prompted a further equity market slump.
In Japan, the Nikkei closed 2.5% lower at 15,007 and has now fallen 8% since the start of the year, against a backdrop of poorly-performing equity markets worldwide.
In the US, the S&P 500 closed down 1% following the Fed statement, taking its January losses to 4%, following four consecutive months of gains.
The overnight moves came against a backdrop of ongoing turmoil for some emerging market currencies.
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A day of wild volatility on Wednesday saw the likes of the Turkish lira rebound, then erase those gains, following a surprisingly aggressive rate hike from the central bank.