Australia stocks jump after smaller-than-expected rate hike; Asia markets rise

The Dow Jones Industrial Average popped 765.38 points, or nearly 2.7%, to close at 29,490.89. The S&P 500 advanced about 2.6% to 3,678.43. The Nasdaq Composite added nearly 2.3% to end at 10,815.43.

The Reserve Bank of Australia said its rate hike of 25 basis points will “help achieve a more sustainable balance of demand and supply” in the nation’s economy.

The central bank said it expects to continue increasing rates over the period ahead.

It also noted that Australia’s unemployment rate is at its lowest in almost 50 years and said an increase in the rate is expected with slowing economic growth.

Australia’s central bank raises interest rates by 25 basis points

RBA’s board members had said “the case for a slower pace of increase in interest rates as becoming stronger,” according to minutes from its meeting in September.

This is the sixth consecutive move by the central bank in its attempt to control inflationary pressures in the economy.