LONDON - World stock markets rose Friday after a top Federal Reserve official said he would back a small interest rate hike at its next meeting and hinted at a possible summer pause to evaluate how tighter policy has cooled high inflation.
Atlanta Fed chief Raphael Bostic said he favored a quarter-point move, denting the dollar.
"This seemed to placate markets somewhat after being on a relentless 'higher for longer' train for the last few days," said analyst Neil Wilson at trading group Finalto.
Bostic questioned whether rates should go much higher than 5.25 percent from the current 4.5-4.75 percent.
"I let the data guide me," Bostic said. "If the data continue to come in suggesting the economy is stronger than I had projected, I'll adjust my policy trajectory."
A strong run of data had sent chills through trading floors in February -- wiping out almost all January's rally -- as investors realized the US central bank had more work to do to control prices.
The unease largely overshadowed optimism about China's recovery after officials ended three years of strict zero-Covid containment measures that battered the world's number two economy.
Several Fed policymakers have lined up to insist that while consumer prices are coming down, they are determined to keep hiking rates until they hit their two percent inflation target.
The latest indicators have led investors to bet on rates hitting a peak of 5.5 percent, though six percent has also been mooted.
Figures this week showed eurozone inflation stubbornly-high in February, leading European Central Bank chief Christine Lagarde to say more tightening was needed.
- Key figures around 1120 GMT -
London - FTSE 100: UP 0.2 percent at 7,961.23 points
Frankfurt - DAX: UP 1.0 percent at 15,481.63
Paris - CAC 40: UP 0.8 percent at 7,342.01
EURO STOXX 50: UP 0.9 percent at 4,279.88
Tokyo - Nikkei 225: UP 1.6 percent at 27,927.47 (close)
Hong Kong - Hang Seng Index: UP 0.7 percent at 20,567.54 (close)
Shanghai - Composite: UP 0.5 percent at 3,328.39 (close)
New York - Dow: UP 1.1 percent at 33,003.57 (close)
Euro/dollar: UP at $1.0615 from $1.0597 on Thursday
Pound/dollar: UP at $1.1986 from $1.1946
Euro/pound: DOWN at 88.55 pence from 88.71 pence
Dollar/yen: DOWN at 136.20 yen from 136.77 yen
West Texas Intermediate: DOWN 0.3 percent at $77.94 per barrel
Brent North Sea crude: DOWN 0.5 percent at $84.35 per barrel