Asian markets records sharp fall today, with Japan’s Nikkei index down by just over 3%, while Hong Kong’s Hang Seng closed 3.2% lower and the Kospi in South Korea down by 3.5%, the BBC reported. The Indian rupee has also fallen to a record low, dropping below 78 to the US dollar.
This comes as the US records the highest inflation rate in 40 years, reaching 8.6% in May, caused by rising energy and food costs, with the price of petrol averaged more than $5 a gallon for the first time on Saturday, according to the American Automobile Association. Covid infections in Beijing’s most populous Chaoyang district also fuelled concerns over further lockdowns and slow economic recovery.
The Federal Reserve is due to make its next policy announcement on Wednesday, and is expected to raise interest rates to contain rising costs. This follows the central bank’s annoncement last month of lifting the benchmark interest rate to 0.75% to 1%, the largest interest rate increase in more than two decades.