Asian shares on edge as investors brace for Fed
Asian shares fell to 10-week lows on Tuesday as investors braced for a possible hawkish shift in the Federal Reserve’s policy stance in the lead-up to the U.S. central bank’s two-day policy meeting later in the day.
Speculation that the Fed could raise interest rates sooner and faster than previously expected has rattled many share markets around the globe and supported the U.S. dollar.
The Fed’s Open Market Committee will begin its regular two-day policy meeting later on Tuesday, and investors will be scanning the outcome for clues on the timing of the first U.S. rate hike in more than eight years.
U.S. central bank policymakers will also release fresh economic and interest-rate projections, extending their forecast horizon through 2017.
“At Wednesday’s FOMC meeting, changes to Fed forecasts and wording that reflects expectations that rates could go higher sooner than expected should provide support” to the U.S. dollar, strategists at Barclays said. “We also look for a modest steepening in the median policy path and more clarity on exit principles.”
Source: reuters-asian shares
