Global stock markets are responding cautiously Friday to the U.S. Federal Reserve's decision to hold off on raising interest rates.
In a long-awaited announcement Thursday, the U.S. central bank decided to keep interest rates unchanged at the record low rate they have been at for several years.
The Fed is still widely expected to raise rates before the end of the year. But just when this will happen is not clear, and that uncertainty appears to be rattling some investors.
On Friday, Japanese stocks closed down 2 percent. Markets in China made slight gains, ending the day up half of a percent. European shares were down around 1 percent at opening.
The recent slowdown in the world economy, particularly in China, was a main reason for the delay in raising interest rates, according to Federal Reserve Chair Janet Yellen.
She also said officials want to first see more improvements in the U.S. labor market and would like inflation to rise to the 2 percent annual rate they think is best for the economy.
It would have been the first rate increase in nearly a decade. The central bank changes interest rates in an effort to steer the economy toward stable prices and full employment.
The Fed cut the rates to a record low range between zero and a quarter of a percent during the financial crisis in a bid to support economic growth. Economists say higher rates would tend to slow growth and make it less likely that inflation will rise sharply and harm the economy.
Since then, unemployment has improved, falling from 10 percent to just over 5 percent. Inflation, however, has stayed below the 2 percent annual rate that Fed officials think works best for the economy.