Latin American Markets Slide After Fed Interest Rate Hike

The US Federal Reserve's decision to raise interest rates by 25 basis points sent shockwaves through Latin American markets on Wednesday.

The move, which marked the first rate hike under new Fed Chair Kevin Warsh, was seen as a signal that policymakers may raise rates again this year if inflation pressures continue.

According to Juan Perez, director of trading at Monex, the unanimous vote suggests the Fed is prepared to act one more time, likely in December, if additional evidence of inflationary pressures emerges for the rest of the year.

The strengthened dollar put pressure on regional currencies, with rising 0.6% following the announcement and slipping 0.3%. The region's equities gauge fell 0.8%.