The dollar climbed to the highest level since 2003 against the euro and gold plunged as the prospect of a steeper path for U.S. interest rates filtered through markets. U.S. stocks rebounded from the worst day in two months.

Financial shares led gains in major American equity benchmarks, while rate-sensitive stocks slipped after U.S. 10-year yields reached the highest level in more than two years. The greenback extended its advance against major and emerging-market peers after the Federal Reserve’s first interest-rate hike of 2016 came with a signal of three increases next year. Gold tumbled 2.6 percent to a 10-month low.

The Fed’s move marks a step in what is expected to be a shift away from global central-bank policy dominating financial markets toward what a potential rise in fiscal stimulus. While stocks have rallied and bonds have tumbled since Donald Trump’s election fueled such expectations, the U.S. central bank stands largely alone in actively tightening policy, a stance that’s sent the dollar surging. The Bank of England kept its key rate at a record low Thursday, a week after the European Central Bank extended quantitative easing.

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