Belfast Telegraph

Markets slump over worry for economies

By Colm Kelpie

Financial markets around the world fell yesterday, oil traded lower and the value of the dollar dropped amid investor unease over the health of the global economy.

Wall Street fell sharply for the fourth straight day on opening as traders slashed odds that the US Federal Reserve would hike interest rates next month - the first rise in nine years - after the central bank continued to voice concerns about lagging inflation in the world's largest economy.

In the UK, the FTSE 100 fell for an eighth straight day and was around 10% lower than its high in April, meaning it moved into correction territory. Gold rose as demand for safe havens intensified.

Minutes from July's meeting of the Federal Reserve, released on Wednesday, appeared to pour cold water on rising expectations that the US central bank would increase rates next month in a sign of confidence in the US recovery.

But while the minutes showed that Fed officials agreed that the world's largest economy was nearing a point where rates should move higher, some were worried lagging inflation and a weak global economy posed risks too big to commit to a lift-off.

Juliet Tennent of Goodbody Stockbrokers said the minutes were more doveish than expected.

Belfast Telegraph