US Fed to pump $600bn into economy

The controversial new policy, which takes the Federal Reserve into largely uncharted waters, is aimed at further lowering borrowing costs for US consumers and businesses still suffering in the aftermath of the worst recession since the Great Depression.

The Fed said it would buy about $75bn in longer-term Treasury bonds per month and would regularly review the pace and size of the programme.

In its post-meeting statement, it described the economy as "slow" and said employers remained reluctant to take on staff. It added that measures of inflation were "somewhat low."