U.S. holds interests rates as expected and forecasts 3% growth in 2011

The U.S. Federal Reserve's Federal Open Market Committee (FOMC) announced today that after a 2 day meeting it had decided to keep  interest rate at a target range of 0 to 0.25% and confirmed that the $600 billion Quantitative easing program, so called QE2,  would end as planned at the end of June 2011. 

Federal Reserve chairman is currently giving a press conference for the first time ever after an FOMC meeting and said that the Fed expects the U.S. economy to grow between 3.1% and 3.3% in 2011 against forecasts of 2.9%, down from 3.4% to 3.9%  The U.S. economy is forecast to grow between 3.5% and 4.2% in 2012 and between 3.5% and 4.3% in 2013. They also predict that inflation will grow between 2.1% and 2.8% this year.

The Dow industrials are currently up 62 points to 12,657, a new 2011 high as investors endorse the continuation of "easy money", reasonable growth projections and booming U.S. corporate earnings.  For the FTSE 100 this means good news, although its heavy commodity weighting means that continued momentum is needed to drive the U.K. index.