Global Stocks Slide, Dollar Rampant As Fed's Powell Spooks Markets

Global stock markets fell after Fed Chair said the US economy will need tight monetary policy "for some time" before inflation is under control.

An index of global stock markets fell, while short-term US Treasury yields rose on Friday, after Federal Reserve Chair Jerome Powell said the US economy will need tight monetary policy "for some time" before inflation is under control.

The dollar erased early losses to turn positive against a basket of currencies, while gold, which loses appeal as interest rates rise, fell after Mr Powell's comments.

Tight monetary policy "for some time" means slower growth, a weaker job market and "some pain" for households and businesses, Mr Powell said in a speech to the central banking conference in Jackson Hole, Wyoming.

"Reducing inflation is likely to require a sustained period of below-trend growth. Moreover, there will very likely be some softening of labor market conditions," Mr Powell said.