Fed Rate Hike Expectations Send Markets Reeling, Oil Prices Surge on US Strike

The US Federal Reserve's decision to raise interest rates has sent shockwaves through global markets. Asian shares and US futures declined on expectations that the Fed may hike rates soon, while oil prices surged after a US strike on Iranian rocket launchers in the Strait of Hormuz.

Brent crude rose 2.9% to $90.61 per barrel, and US benchmark crude jumped 2.7% to $85.66 per barrel, following the military action. Stephen Innes of SPI Asset Management commented that 'the Middle East had finally gone quiet enough for oil traders to start sanding some of the war premium out of crude.'

The Fed's Chairman Kevin Warsh reinforced expectations of a rate hike in a speech at an annual economic symposium, stating that short-term interest rates are the predominant tool for keeping inflation low and the job market strong.