BANGKOK (AP) — Shares were mostly higher in Asia on Thursday after the Federal Reserve ratcheted up its campaign against surging inflation by raising its key interest rate three-quarters of a point.

Hong Kong’s benchmark Hang Seng index slipped 0.6% to 20,554.09 after the territory’s Monetary Authority matched the Fed’s 0.75 percentage point rate hike with one of its own. The HKMA aligns its policies with U.S. monetary moves to keep the Hong Kong dollar at a stable rate with the U.S. dollar.

Elsewhere in the region, shares advanced, tracking gains on Wall Street after the Fed did exactly as expected and its chair, Jerome Powell, suggested the Fed’s rate hikes have already had some success in slowing the economy and possibly easing inflationary pressures.

Investors are awaiting an update on U.S. economic growth and a call between U.S. President Joe Biden and Chinese leader Xi Jinping.

“While a concrete decision on tariff relief is not expected from the meeting, any indications of willingness in working toward that is an added positive for markets,” Jun Rong Yeap of IG said in a commentary.

Tokyo’s Nikkei 225 edged 0.2% higher to 27,761.53 while the Shanghai Composite index added 0.6% to 3,294.42. In Seoul, the Kospi advanced 0.7% to 2,432.91.

Australia’s S&P/ASX 200 jumped 0.9% to 6,881.80 after the government reported that retail sales rose in June for the sixth consecutive month. Markets in Thailand were closed for a holiday.

On Wall Street investors welcomed the Fed’s widely expected move — which took its key interest rate to its highest level since 2018 — with a broad rally on Wednesday.

Powell’s comments were taken by some as a signal the Fed may not have to raise rates so aggressively in coming months, triggering a rally in the final hour of regular trading.

The S&P 500 climbed 2.6% to 4,023.61 and the tech-heavy Nasdaq surged 4.1%, its biggest gain in over two years, to 12,032.42. The Dow Jones Industrial Average rose 1.4% to 32,197.59. Smaller company stocks also gained, lifting the Russell 2000 2.4% higher, to 1,848.34. The indexes are now all on pace for a weekly gain, extending Wall Street’s strong July rally. The S&P 500 is up 6.3% so far this month.

Bond yields turned broadly lower following the Fed’s announcement. The two-year Treasury yield, which tends to move with expectations for the Fed, fell to 2.98% from 3.06% late Tuesday. The 10-year yield, which influences mortgage rates, fell to 2.78% from 2.79%.

Rate increases like Wednesday’s, the fourth so far this year, make borrowing more expensive and slow the economy. The hope is that the Fed and other central banks can deftly find the middle ground where the economy slows enough to whip inflation but not enough to cause a recession.

In a note Wednesday, analysts at Citi said that while Powell mentioned that a slowdown in hikes would be appropriate at some point, exactly when that might be remains unclear, adding that they “would not view this as a particularly dovish comment.”

“We continue to expect core inflation to push the Fed to hike more aggressively than they or markets anticipate,” the analysts wrote, noting they expect the Fed will announce another three-quarter point increase at its September policy meeting, with further rate hikes continuing into early 2023.

Meanwhile, some parts of the economy are already slowing, particularly the housing industry. Sales of previously occupied U.S. homes slowed in June for the fifth month in a row as mortgage rates have climbed sharply this year.

An update on the economy will come later Thursday with second quarter U.S. GDP data.

Shares in Microsoft and Google parent Alphabet rose 6.7% and 7.7%, respectively, after their latest quarterly reports.

Spotify Technology vaulted 12.2% after the music streaming service reported monthly active user and premium subscriber numbers that exceeded the Street’s expectations.

In other trading Thursday, U.S. benchmark crude oil added $1.04 to $98.30 per barrel in electronic trading on the New York Mercantile Exchange. It gained $2.28 to $97.26 on Wednesday.

Brent crude, the international standard for pricing, gained 93 cents to $102.60 per barrel.

The U.S. dollar cost 135.44 Japanese yen, down from 136.55 yen. The euro rose to $1.0208 from $1.0197.

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AP Business Writer Alex Veiga contributed.