Asian shares fall after Fed rate hike, tracking Wall St lead

"I don't think this is a surprise to anyone in terms of the narrative about how weak and stretched the consumer is and will be for the next quarters", JPMorgan Asset Management global market strategist David Stubbs said.

The decision of the FED is not a fundamental factor affecting the manat rate against to the United States dollar, according to him.

However, Yellen & Co. offered a relatively sanguine outlook for inflation and the USA economy at her Wednesday afternoon news conference, cautioning Wall Street "not to overreact to a few readings", even as the Federal Open Market Committee lowered its inflation outlook.

Round one of this battle occurred in the first quarter of the year. But the Fed maintained its forecast for three rate hikes next year. According to the Hyundai Research Institute, a 0.25 percentage point hike in rates could raise interest by 420,000 won per year for each household. However, mortgage rates are not expected to increase immediately.

Fed officials have also largely dismissed recent slowdowns in the USA economic data and inflation as transitory, focusing instead on the 4.3 percent unemployment rate (lowest since 2001) and other evidence of job market tightness.

With the prospect of a slower pace of rate increases, the Stoxx Europe 600 Banks Index traded in negative territory for most of the session.

The one-year Shanghai Interbank Offered Rate (SHIBOR) has climbed to two-year highs and is now at 4.42 percent, above the PBOC's official lending rate of 4.35 percent.

The central bank also confirmed that later this year it would begin to implement a plan to reduce the size of its investment holdings, which were built up to record levels during the financial crisis to help support the economy, especially once interest rates reached zero.

Markets are skeptical, to put it mildly.

The VND/USD exchange rates saw little changes this morning although the US Federal Reserve (Fed) raised interest rates on Wednesday on the confidence in a growing economy and strengthening job market in the world's biggest economy.

Federal Reserve Chair Janet Yellen arrives to receive her honorary doctorate degree from New York University (NYU) at Yankee Stadium in the Bronx borough of New York May 21, 2014. While inflation has moderated in recent months, the Fed seems to be attributing this mostly to one-off factors.

Going forward, the markets are once again set to resist the Fed's rate hike overtures after an uneasy détente in the spring.

The common theme then, as now, has been a slow growth economy with low inflation.

In her press conference after the announcement, Fed Chair Janet Yellen asserted that US economic growth appears to have rebounded enough to justify both higher rates and a return of Fed-held assets to the wider market.

Bankrate's national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in 10 top markets. Stanley is a regular guest on CNBC and Bloomberg TV.

Stephen Stanley is the chief economist at Amherst Pierpont, a broker-dealer servicing institutional and middle-market clients with a range of fixed-income products.