Higher-than-expected inflation is putting upward pressure on the US Federal Reserve to raise its policy rate more sharply than expected.
Stateside The New York Stock Exchange closed down. On Wall Street, the broad-based S&P 500 index fell 3.9 percent. The drop is more than 20 percent from the index’s latest peak at the beginning of the year.
The Dow Jones index fell 2.8 percent and the technology-focused Nasdaq index fell 4.7 percent.
Monday was the fourth consecutive downtrade on the New York Stock Exchange.
Last week, the United States released an inflation rate of 8.6 percent in May. Higher-than-expected inflation is putting upward pressure on the US Federal Reserve to raise its policy rate more sharply than expected.
Financial News Agency Bloomberg writes that the future rate hike may be the largest since 1994.
An increase in interest rates would have significant effects on the U.S. economy but also globally.
In Japan The Tokyo Stock Exchange opened lower on Tuesday. The stock market’s Nikkei index was down 1.56 percent in the morning local time.
“In Japan, equities are starting to see huge declines after U.S. indices fell for the fourth time in a row,” Monex senior market analyst Toshiyuki Kanayama said.
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