The Dow Jones industrial average rose 163.74 points, or 0.9 percent, to 18,293.7, the S&P 500 gained 23.36 points, or 1.09 percent, to 2,163.12 and the Nasdaq Composite added 53.83 points, or 1.03 percent, to 5,295.18.
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Spot gold dropped 0.2 percent to $1,334.41 an ounce by 0411 GMT; but was on track for a weekly gain of almost 2 percent, the highest since end-July.
Fed Chair Janet Yellen said United States growth was looking stronger and rate increases would be needed to keep the economy from overheating and fuelling high inflation.
The Fed signalled an increasingly careful approach to future rate hikes after a policy meeting on Wednesday, reassuring investors who had feared the US central bank could move more quickly to tighten monetary policy. Raising rates slightly and gradually, said, could prevent overheating in the labor market and allow the recovery to continue longer than otherwise. “The underlying message from the Fed this week was that they want to raise rates”, Mr. Donabedian said. “We believe that the unemployment rate has been underestimated and that the Fed is holding out for some improvement”. The labor market continued to improve as the USA economy added over 1.4 million jobs so far this year.
“This seems to have been one of the most divisive [Fed] meetings in recent memory”, says Paul Ashworth, chief USA economist at Capital Economics, a research firm.
“In July, the Fed statement acknowledged that “near-term risks to the economic outlook have diminished” but omitted, as had all previous statements this year, any language on the balance of risks”, Mr Clarida said.
Palladium was up 0.5 percent at $696.50, after rising 1.5 percent on Thursday.
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Traders have priced in an 18 percent chance of a rate hike hours before the Fed statement. But the central bank maintained the low-interest rate environment that has helped underpin the bull market for stocks. Earlier this year, output freeze discussions broke down when Saudi Arabia decided that Iran should join in the freeze, despite the fact that Tehran had said it wouldn’t consider the possibility until reaching pre-sanction levels of production. The Bank of England and the European Central Bank have their own (asset-purchase) programs ongoing at the moment. “The FOMC is unlikely to deliver anything more than a very “dovish” December hike”. A few things we won’t tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. “We don’t think the Fed would act before the presidential elections in November”.
