Treasuries Climb, Dollar Retreats on Fed Outlook: Markets Wrap
- S&P 500 gives back gains after interest rate hike announcement
- Gold surges as central bank expects 3 rate increases in 2018
Treasuries rose and the dollar slipped for the first time in five days after the Federal Reserve increased interest rates and raised its outlook for economic growth in 2018 without lifting its forecast for the number of hikes next year. Stocks were mixed and gold surged.
The S&P 500 Index swooned in the final 15 minutes of trading to end lower. Earlier, stocks spiked to an intraday record on the Fed’s widely anticipated announcement that it was hiking rates by a quarter of a percentage point amid rising optimism in the economy. The yield on 10-year Treasuries slumped with the dollar after central bankers kept their projection for three hikes next year unchanged as inflation remains persistently sluggish. The small-cap Russell 2000 Index, whose members’ fortunes are most closely tied to economic gains, was the strongest performing equity gauge.