By Max Clarke
Global stock markets edged back from the lows reached yesterday after the US Federal Reserve assured interest rates would be held between 0-1/4% until mid-2013.
To promote the ongoing economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent., quoted The US Federal Open Market Committee- the body charged with setting the reserve’s base rate and curbing inflation.
The move has reassured investors after the threat of a return of a worldwide financial crisis saw £200bn sliced off the value of the UK’s FTSE 100 index over the past week, along with similar percentage losses in Asian, US and European markets.
The US tech market-Nasdaq- saw the largest gains 0f 5.29% and the FTSE edged up by 8.05 points, or 0.16%. Only Paris’ Cac 40 continued to slide, dropping 11.46 points.
Oil prices climbed 2.7%, compensating the losses made by oil and other commodities this week, whilst gold prices edged up 2.5%.
The Committee, however, anticipated a ‘somewhat slower pace of recovery over coming quarters' than it had done previously, hinting at an extension of its asset purchase, or quantitative easing, programme.
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