Fed feeds recession fears, Japan steps in to support yen

LONDON, Sept 22 (Reuters) - World stocks were close to a two-year low and Japan was forced to intervene to prop up the yen for the first time since 1998 

on Thursday after the Federal Reserve's aggressive U.S. rate hike signals had markets on the run. 

In Europe, where on top of economic pain and volatility fears rose after a Russian threat to use nuclear weapons to defend itself, major stocks markets  

Tokyo swooped to support the yen not long after European markets opened. 

While the move seemed to have been coming for weeks, the yen has fallen 20% this year almost half of which came in the last six weeks, it still packed a punch. 

The yen surged to 142.39 from 145.81 to the dollar in the space of a few minutes and got to 140 before stopping. /FRX

It helped the euro lift off a 20-year low too and hoisted sterling , 

which is not far behind the yen having lost over 8% since August, from a 1985 low as the Bank of England raised its rates by another 50 basis points.