Asia stock markets slide on US interest rate fears

Shares in Asia have fallen after the chairman of the US central bank said it would continue to raise interest rates to tackle soaring prices.

Jerome Powell warned that the Federal Reserve’s policies will cause “some pain to households and businesses”.

Higher interest rates make borrowing more expensive for individuals and companies, which could slow economic growth as well as inflation.

Japan’s Nikkei 225 index closed 2.7% lower on Monday in Tokyo.

Elsewhere in the Asia-Pacific region, the Kospi in South Korea and Australia’s ASX 200 were both down by around 2%, while the Hang Seng in Hong Kong was 0.8% lower.

That came after the main share indexes in New York each fell by more than 3% on Friday after Powell’s remarks.

During a highly-anticipated speech at a conference in Jackson Hole, Wyoming, Powell said the Federal Reserve was likely to continue raising interest rates in the coming months and could keep them high “for some time”.