European Rates Higher Ahead of FOMC

Shares and bond markets have risen as investors get ready for what is expected to be the first rise in US interest rates in nearly a decade.

The Federal Reserve is expected to announce the start of the gradual rate rise process at 19:00 GMT.

In London, the FTSE 100 climbed steadily in early trading, while Asian markets finished with big gains.

A US rate rise would have global repercussions, and could adversely affect emerging economies, experts say.

The US Federal Reserve is expected to raise its benchmark overnight interest rate from near zero, encouraged by a strengthening US labour market.

Analysts have been speculating for months as to when the first rise might be, with global stockmarkets rising and falling as Fed rate meetings come and go.

Low interest rates have generally been helpful for stock market investors, but Fed officials have indicated the likely decision in advance, removing some of the uncertainty that investors dislike.

In London, the FTSE 100 climbed steadily in morning trading, gaining 0.8%. Paris and Frankfurt markets were up by a similar amount.

Many Asian markets closed significantly higher – Japan’s Nikkei 225 gained 2.6%, and Hong Kong’s Hang Seng rebounded, rising 2%.

via BBC

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