Fed Signals Higher Rates May Still Be Needed, Stocks Fall

US stocks declined after Federal Reserve officials signaled that further rate hikes may be necessary, reinforcing a hawkish policy stance. No specific rate figures were cited, but the tone rattled equity markets heading into the close. The USD is likely to strengthen on renewed rate-hike expectations, pressuring EUR/USD and GBP/USD lower. Traders should watch for follow-through dollar buying as rate differentials shift further in favor of the greenback.