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US Fed says economy 'picked up' | US Fed says economy 'picked up' |
(20 minutes later) | |
The US Federal Reserve has said economic activity is "picking up" but that it expects to keep interest rates close to zero for an "extended time". | The US Federal Reserve has said economic activity is "picking up" but that it expects to keep interest rates close to zero for an "extended time". |
Its comments came as it confirmed it was keeping the rate at its record low level seen since December. | Its comments came as it confirmed it was keeping the rate at its record low level seen since December. |
Economists predict that the rate will stay at this level throughout the rest of this year, and perhaps into 2010. | Economists predict that the rate will stay at this level throughout the rest of this year, and perhaps into 2010. |
In comments earlier this month, the Fed chief Ben Bernanke said he was confident the US was out of recession. | In comments earlier this month, the Fed chief Ben Bernanke said he was confident the US was out of recession. |
US interest rates were cut to the current level of between 0% and 0.25% in December last year, where they have remained ever since. | US interest rates were cut to the current level of between 0% and 0.25% in December last year, where they have remained ever since. |
Before then rates had fallen steadily from a high of 5.25% in September 2007. | Before then rates had fallen steadily from a high of 5.25% in September 2007. |
Unemployment impact | |
The Fed policymakers voted unanimously to hold rates, They also pledged to continue a program with $1.45 trillion to help keep credit flowing to the housing market and other segments of the economy by purchasing mortgage securities and other assets. | |
Earlier this month, Mr Bernanke said the US economy would still feel "very weak" to Americans concerned about job security. | |
Unemployment, which is set to move above 10% this year, may impact on consumer behaviour, the Fed has warned. |
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