Market slump continues as US Fed pushes on with QE taper
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.
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.