Stocks track record day on Wall St, dollar extends losses

NEW YORK - Equity markets rallied on Thursday and the dollar extended losses after the US Federal Reserve indicated it would begin cutting interest rates next year. 

The surge across the region tracked a record-breaking day on Wall Street, where traders cheered a much-sought-after dovish pivot from the central bank as US inflation comes down.

After more than a year of hiking, decision-makers at their last meeting of the year acknowledged that they were winning their battle against rising prices and discussed when to change tack to a looser monetary policy.

The Fed held rates at a 22-year high, as expected, and said the decision lets policymakers determine "the extent of any additional policy firming that may be appropriate".

The addition of "any", which was absent in November's decision, was "an acknowledgement that we believe that we are likely at or near the peak rate for this cycle", Fed chief Jerome Powell told reporters. 

Officials also released their "dot plot" of future rates, which saw 75 basis points of cuts in 2024 -- more than indicated in September. 

Traders are betting on 140 basis points of cuts over the next year, Bloomberg News said.