Shanghai, Tokyo, Hong Kong and Sydney declined. Oil prices edged higher.

The dollar rose to nearly 145 Japanese yen after the Bank of Japan opted to keep its ultra-lax monetary policy unchanged, with its benchmark interest rate at minus 0.1%. Japan’s central bank has maintained such a policy for years, trying to stimulate business activity and counter deflation.

By mid-afternoon, the dollar was at 144.94 yen, up from 143.46 yen late Wednesday. The euro fell to 98.29 cents from 99.09 cents.

Wall Street’s benchmark S&P 500 index fell 1.7% on Wednesday to a two-month low after the Fed raised its benchmark lending rate by 0.75 percentage points, three times its usual margin. The Fed said it expects that rate to be a full percentage point higher by year’s end than it did three months ago.

“The Fed still managed to out-hawk the markets,” Anna Stupnytska of Fidelity International said in a report. “Economic strength and a hot labor market point to a limited trade-off — at least for the time being — between growth and inflation.”

The Shanghai Composite Index sank 0.3% to 3,108.43 and the Nikkei 225 in Tokyo slid 0.6% to 27,153.83. Hong Kong’s Hang Seng tumbled 1.7% to 18,134.45.

South Korea’s Kospi sank 0.7% to 2,331.76 and India’s Sensex opened down 0.4% at 59,456.78.

New Zealand edged up less than 0.1% while Southeast Asian markets declined.

The Fed and central banks in Europe and Asia are raising rates to slow economic growth and cool inflation that is at multi-decade highs.

Traders worry they might derail global economic growth. Fed officials acknowledge the possibility such aggressive rate hikes might bring on a recession but say inflation must be brought under control. They point to a relatively strong U.S. job market as evidence the economy can tolerate higher borrowing costs.

“The Fed’s new economic projections highlight it will tolerate a recession to bring inflation down,” said Gregory Daco of EY Parthenon in a report.

The yield on the 2-year Treasury, or the difference between the market price and the payout if held to maturity, rose to 4.02% from 3.97% late Tuesday. It was trading at its highest level since 2007.

The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.52% from 3.56% late Tuesday.

The S&P 500 fell to 3,789.93. The Dow fell 1.7% to 30,183.78, and the Nasdaq composite lost 1.8% to 11,220.19.

The major Wall Street indexes are on pace for their fifth weekly loss in six weeks.

Fed chair Jerome Powell stressed his resolve to lift rates high enough to drive inflation back toward the central bank’s 2% goal. Powell said the Fed has just started to get to that level with this most recent increase.

The central bank’s latest rate hike lifted its benchmark rate, which affects many consumer and business loans, to a range of 3% to 3.25%, the highest level in 14 years, and up from zero at the start of the year.

The Fed released a forecast known as a “dot plot” that showed it expects its benchmark rate to be 4.4% by year’s end, a full point higher than envisioned in June.

U.S. consumer prices rose 8.3% in August. That was down from July’s 9.1% peak, but core inflation, which strips out volatile food and energy prices to give a clearer picture of the trend, rose to 0.6% over the previous month, up from July’s 0.3% increase.

Central bankers in Britain, Switzerland and Norway are due to report on whether they also will raise rates again. Sweden surprised economists this week with a full-point hike.

The global economy also has been roiled by Russia’s invasion of Ukraine, which pushed up prices of oil, wheat and other commodities.

In energy markets, benchmark U.S. crude gained 19 cents to $83.13 per barrel in electronic trading on the New York mercantile Exchange. The contract fell $1 to $82.94 on Wednesday. Brent crude, the price basis for international oil trading, advanced 20 cents to $90.03 per barrel in London. It lost 79 cents the previous session to $89.83.