THE Federal Reserve - the US central bank - gave ailing stock markets on both sides of the Atlantic a tonic last night by keeping key interest rates steady.
Joseph Coyne, a spokesman for the Federal Open Market Committee in Washington, said the overnight Fed funds rate, which determines borrowing costs throughout the American economy and sets the standard for global rates, remained unchanged at 5.5%.
The discount rate, at which the Fed extends emergency loans to commercial banks, was left at 5%.
The statement came as a relief to Wall Street analysts, traders and strategists. The Dow fell 20 points after the news but quickly recovered and headed higher.
Although the decision came too late for the UK exchange, London blue chips rose earlier on the expectation that the Fed would hold the line on rates.
Chips claw back losses Page 21
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