March 17 Reuters Wall Street ended higher on Wednesday after the Fed predicted a fast economic recovery from the coronavirus pandemic and said it would maintain its interest rate at close to zero.
In its statement following its twoday policy meeting, the Federal Reserve projected a rapid jump in U.S. economic growth and inflation this year as the COVID19 crisis winds down, and repeated its pledge to keep its target interest rate near zero for years to come.
Wall Street extended gains after Fed Chair Jerome Powell said during a news conference that it is too early to discuss taperingoff measures to support the struggling economy.
The Fed statement today was more optimistic than some expected, they raised their outlook for both economic growth and the labor market. The markets view of the statement is that it was fairly optimistic, said David Carter, chief investment officer at Lenox Wealth Advisors in New York.
A 1.9 trillion spending stimulus and the rollout of vaccines have fueled a rotation into socalled value stocks that are viewed as likely to outperform as the economy recovers from the coronavirus pandemic.
At the same time, worries that the stimulus could overheat the economy and lead to higher inflation rates have triggered a strong rise in longduration Treasury yields and made technology and other growth stocks less attractive.
Following the Feds statement, the yield on 10year Treasuries ticked lower to 1.6374.
Unofficially, the Dow Jones Industrial…