US raises rates in December for a third year

The US Federal Reserve voted yesterday, unanimously, to raise US interest rates by a quarter percentage point from 2% to 2.25%. Whilst the raise was almost completely expected by markets, investors had started to expect the FED would accompany the rise with some dovish language about limiting the number of rate rises in 2019. This dovish language did not materialise leading markets to assume the FED are on course to make a policy mistake in 2019 which could take the global economy closer to a recession. The S&P 500 subsequently sold off by 3% on these fears.