World stock markets rise after Fed stimulus trim announcement

Global stock markets rallied after the US Federal Reserve’s commitment to keep interest rates low offset its decision to taper its stimulus programme.

Germany’s Dax and France’s CAC were 1.5% in mid-morning trading, while the UK’s FTSE rose 1%. Japan’s Nikkei 225 closed up 1.7%.

The Fed said it would scale back its $85 billion a month bond-buying programme by $10 billion a month.

Analysts said the taper was less than markets had expected.

Investors and economists have been watching closely for when the Fed would scale back its stimulus, fearing that a steep taper could undermine economic recovery.

Global stock markets rallied after the US Federal Reserve’s commitment to keep interest rates low offset its decision to taper its stimulus programme

US markets had ended sharply higher on Wednesday following the Fed’s decision. The Dow Jones jumped 292.71 points, or 1.84%, to close at 16167.97, while both the Nasdaq and S&P 500 indexes rose by more than 1%.

The stimulus programme, called quantitative easing, was introduced by the Fed after the global financial crisis.

The main objective was to increase the money supply and improve liquidity in the financial system in the hope of sparking economic growth and supporting employment.

The Fed’s governing committee cited stronger job growth as a reason for the decision to begin winding down the programme.

It forecast the unemployment rate would fall to 6.3% in 2014 from its current level of 7%.

Analysts said the Fed’s decision to scale back the programme also indicated that it was confident of a sustained recovery in the US economy.

VstnJqU3E-A
Clyde K. Valle

Clyde is a business graduate interested in writing about latest news in politics and business. He enjoys writing and is about to publish his first book. He’s a pet lover and likes to spend time with family. When the time allows he likes to go fishing waiting for the muse to come.

Recent Posts

Donald Trump and Elon Musk Celebrate Election Victory at UFC 309

Image source: Wikimedia Commons President-elect Donald Trump celebrated his election victory at the Ultimate Fighting…

5 days ago

White House 2024: Donald Trump Wins, Kamala Harris Calls Him to Concede Election

Millions of voters across the US chose to return Donald Trump to the White House…

2 weeks ago

Who Won? Donald Trump Declares Victory as He Addresses Jubilant Supporters in Florida

Donald Trump declares victory in the US election as he addresses jubilant supporters in Florida.…

2 weeks ago

Stocks Soaring as Donald Trump Closes in on US Victory

Stocks around the world are rising as Donald Trump appears to be on the cusp…

2 weeks ago

Who Won? Kamala Harris Cancels Election Night Party as Path to Victory Narrows

Donald Trump has won Pennsylvania, North Carolina and Georgia and taken a lead over Kamala…

2 weeks ago

Quincy Jones Dead at 91

Quincy Jones, the celebrated musician and producer who worked with Michael Jackson, Frank Sinatra, Ray…

2 weeks ago