Fed’s first rate hike in three years pushes Australian and US markets lower

The Australian ASX 200 is set to drop after the US Federal Reserve raised interest rates for the first time in three years. The same Fed move also caused the US S&P 500 to slip for a third consecutive trading session. Traders say the rate increase adds pressure on equities worldwide, with investors watching the ripple effect on credit costs and corporate earnings. The ASX 200, a benchmark of Australia’s top‑listed companies, is expected to open lower as market sentiment turns cautious. In the United States, the S&P 500’s three‑day decline reflects growing concerns that tighter monetary policy could slow growth. Both indices are reacting to the same policy shift, highlighting how closely linked global markets are to US rate decisions. Analysts note that the Fed’s action marks a change from a long period of stable rates, and the market’s response may set the tone for the weeks ahead.