AFP, Hong Kong :
Comments from top Federal Reserve officials suggesting a US interest rate rise is still likely this year pushed the dollar and Asian stocks higher Tuesday, as the Fed sought to ease concern about the state of the global economy.
Another rally in Shanghai also bolstered confidence, with the index seeing a third straight day of gains. But the Asian Development Bank flagged concerns about China’s growth, saying it would act as a drag on regional expansion this year.
World markets had tumbled on uncertainty about the global outlook after the US central bank on Thursday delayed announcing a rise, with its head Janet Yellen citing the threats caused by China’s faltering economy as a key reason.
The news sparked fears about the global outlook and about the strength of the US economy itself, which has been steadily getting back on a recovery track.
However, in an attempt to temper the impact of the news, several regional Fed presidents have since sought to reassure dealers, saying they thought the US was in a fit enough state to see a first rate rise by year-end.
Fed Bank of Atlanta president Dennis Lockhart said despite recent volatility in world markets — which followed China’s surprise yuan depreciation in August — he was still confident of a rate lift-off before 2016.
