Global shares fell on Tuesday and the euro hit a fresh two-decade low against the dollar, as fears of tighter monetary policy and a European energy crisis darkened market sentiment. The European Stoxx 600 share index slipped 0.3 per cent lower in early dealings, having dropped by its most in more than month on Monday. Germany’s Xetra Dax lost 0.3 per cent and London’s FTSE 100 dropped 0.3 per cent.
Why Does it Matter
The moves came ahead of the Jackson Hole central bankers’ symposium this week, at which US Federal Reserve chair Jay Powell is expected to underline a commitment to raising interest rates to quell consumer demand in order to tackle stubbornly high inflation. “Chair Powell is likely to state that the Fed will raise rates as far as it takes, and for as long as it takes,” Standard Chartered strategist Steve Englander said.
Futures trading on Tuesday implied Wall Street’s S&P 500 share index would fall 0.5 per cent on Tuesday, having closed 2.1 per cent lower in the previous session in its steepest daily drop in more than two months.