US interest rates left unchanged

The Federal Reserve has kept US interest rates on hold at between 0% and 0.25%, as had been widely expected.

The Fed has kept rates on hold to help the continuing recovery

Despite the US economy growing 3.5% in July to September - its first expansion since June 2008 - rates were left unchanged to further aid the recovery.

The Fed reiterated its view that rates would need to stay at the historic low for an "extended period".

While economic activity had "continued to pick up", it said high unemployment remained a concern.

The most recent official jobless rate totalled 9.8% in September, a 26-year high.

Recovering car sales

Analysts have also cautioned that the economic expansion between July and September was greatly helped by President Obama's $787bn (£480bn) stimulus package, with some fearing that growth will slow markedly when this impetus comes to an end.

One of the most successful parts of the stimulus spending was the $3bn "cash for clunkers" car scrappage scheme, which gave people who traded in old cars $3,500 towards the cost of a new vehicle.

This initiative operated in July and August, giving US car sales a major boost in both months.

Car sales subsequently fell sharply in September after the scheme had concluded.

However, both General Motors and Ford reported earlier this week that their domestic sales rose again in October, suggesting that the recovery in the US car market has now resumed.

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.

http://news.bbc.co.uk