Beijing, Dec 19 (AP) Asian stock markets fell again Monday as investors wrestled with fears the Federal Reserve and European central banks might be willing to cause a recession to crush inflation.

Shanghai, Tokyo, Hong Kong and Sydney declined. Oil prices rose by almost USD 1 per barrel but benchmark US crude stayed below USD 80.

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Wall Street fell Friday after the Fed raised its forecast of how long interest rates have to stay elevated to cool inflation that is near a four-decade high. The European Central Bank warned more rate hikes are coming.

That “hawkish rhetoric” indicates “mounting pipeline risks of a global recession,” said Tan Boon Heng of Mizuho Bank in a report.

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The Shanghai Composite Index lost 1.3 per cent to 3,127.78 despite China's ruling Communist Party announcing Friday that it will try to reverse an economic slump by stimulating domestic consumption and the real estate market.

The Nikkei 225 in Tokyo sank 1.1 per cent to 27,218.28 and the Hang Seng in Hong Kong shed 0.7 per cent to 19,316.58.

The Kospi in Seoul retreated 0.4 per cent to 2,350.27 and Sydney's S&P-ASX 200 was 0.2 per cent lower at 7,137.00. Singapore advanced while New Zealand and other Southeast Asian markets declined.

Wall Street's benchmark S&P 500 index turned in its second weekly decline after losing 1.1 per cent to 3,852.36 on Friday for its third daily drop. It is down about 19 per cent so far this year.

The Dow Jones Industrial Average dropped 0.8 per cent to 32,920.46. The Nasdaq composite lost 1 per cent to 10,705.41.

More than 80 per cent of stocks in the benchmark S&P 500 fell. Technology and health care stocks were among the biggest weights on the market. Microsoft fell 1.7 per cent and Pfizer slid 4.1 per cent.

US inflation has eased to 7.1 per cent over a year earlier in November from June's 9.1 per cent high but still is painfully high.

The Fed on Wednesday raised its benchmark short-term lending rate by one-half percentage point for its seventh hike this year. That dashed hopes the US central bank might ease off increases due to signs inflation and economic activity are cooling.

The federal funds rate stands at a 15-year high of 4.25 per cent to 4.5 per cent. The Fed forecast that will reach a range of 5 per cent to 5.25 per cent by the end of 2023. Its forecast doesn't call for a rate cut before 2024.

In energy markets, US benchmark crude rose 94 cents to USD 75.23 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell USD 1.82 on Friday to USD 74.29. Brent crude, the price basis for international oil trading, gained USD 1.01 to USD 80.05 per barrel in London. It lost USD 2.17 the previous session to USD 79.04.

The dollar declined to 136.25 yen from Friday's 136.56 yen. The euro gained to USD 1.0609 from USD 1.0600. (AP)

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)