Fed rate decision lifts Asia stock markets, currencies

HONG KONG (AFP) – The US central bank’s decision to hold off hiking interest rates sent emerging market currencies and most Asian markets advancing Friday, as concerns eased over an outflow of cash as the global economy suffers a painful slowdown.

Most Asian stock markets advanced with Shanghai ending 0.38 percent higher at the end of another roller-coaster week, while Seoul put on almost one percent and Sydney ticked up 0.46 percent.

Hong Kong ended 0.30 percent higher.

However, Tokyo finished almost two percent lower with investors spooked by Yellen’s downbeat assessment of the global outlook while exporters were also hurt by the stronger yen.

The news pushed the dollar lower. It was buying 119.40 yen in Tokyo trade, compared with 120.90 yen in Asia Thursday. The euro was at $1.1433 against $1.1302 a day earlier.

Struggling emerging market currencies, which have been rising this week on hopes the bank would hold fire, were also higher. The South Korea won added 0.27 percent, the Malaysian ringgit gained 0.64 percent, India’s rupee was one percent higher and the Singapore dollar was up 0.06 percent. The Thai baht and Taiwan dollar also laid on further gains.

After one of the most eagerly awaited meetings in years, the US central bank’s head Janet Yellen said the ongoing crisis in China and recent turmoil on world markets had played a role in keeping borrowing costs at zero.