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Dec. 12, 2012 at 3:03 PM
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Stock gains hold on Fed news

NEW YORK, Dec. 12 (UPI) -- Early stock gains held Wednesday after the U.S. Federal Reserve tweaked a closely watched monetary policy announcement.

The Fed specified 6.5 percent unemployment as the point at which it would consider changing its overnight bank-to-bank lending rate, which has been at zero to 0.25 percent since the recession.

The Fed kept its policy targets intact, holding to its historically low lending rate and announcing it would continue with its asset purchasing programs.

The Fed did not announce additional stimulus measures at this time, which some had expected.

In early afternoon trading, the Dow Jones industrial average added 49.50 points, or 0.37 percent, to 13,297.94.

The tech-heavy Nasdaq index gained 6.14 points, or 0.2 percent, to 3,028.44. The Standard and Poor's 500 added 7.11 points, or 0.47 percent, to 1,434.49.

The 10-year treasury note fell 10/32 to yield 1.693 percent.

The euro rose to $1.3081 from Tuesday's $1.3006. The dollar rose to 83.18 yen from 82.51 yen.

Japan's Nikkei 225 index rose 0.59 percent, 56.14 points, to 9,581.46.

Britain's FTSE 100 index added 0.35 percent, 20.88 points, to 5,945.85.

Fed specifies terms of lending rate

WASHINGTON, Dec. 12 (UPI) -- The U.S. Federal Reserve said Wednesday it would hold its key interest rate in place until the national unemployment rate dropped to 6.5 percent.

The Fed said it would consider other economic data in making its decision. The overnight bank-to-bank lending rate has been set at zero to 0.25 percent since the recession, which officially ended in June 2009.

But the Fed's gambit, while leaving the rock-bottom rate unchanged, was to change its terminology and disclose what has always in the past been seen as a trade secret: An actual benchmark that businesses and investors can see so they can plan their decisions accordingly.

"To support continued progress toward maximum employment and price stability, the (Open Market) Committee expects that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens," the central bank said in a statement.

"In particular, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6-1/2 percent."

On balance, the Fed said inflation is expected to remain "no more than a half percentage point above the Committee's 2 percent longer-run goal, and longer-term inflation expectations continue to be well anchored."

The Fed said it would keep its asset buying purchase at the same pace, at $85 billion per month, and continue with operation twist, the program that uses the proceeds from maturing short-term securities to buy long-term securities.

Import prices dropped in November

WASHINGTON, Dec. 12 (UPI) -- U.S. import prices fell 0.9 percent in November, with declines pushed by lower fuel costs, the Labor Department said Wednesday.

Export prices fell 0.7 percent in the month with a decline in non-agricultural exports down 0.4 percent and the price of agricultural exports up 0.1 percent.

On a 12-month basis, import prices were down 1.6 percent in November, while export prices from November 2011 were up 0.7 percent.

Over 12 months, agricultural export prices have jumped 10 percent, while non-agricultural export prices have dropped 0.4 percent.

Fuel prices over 12 months are down 7 percent, a contrast to the previous 12 months in which imported fuel costs were up 32.4 percent, the department said.

Tony Lama Jr., of boot company, dies

EL PASO, Texas, Dec. 12 (UPI) -- Tony Lama Jr., former chief executive officer and president of Tony Lama Co., has died at age 81, his family has said.

Lama Jr. took over the company his father founded and made it a national brand through the 1970s and 1980s, the El Paso, Texas, Times reported Wednesday.

One of his daughters, Melissa Lama, said her father was handed the reins to the business based on the strength of his personality. Lama Sr. died in 1974 and Lama Jr. took over.

"He was a very charming, gracious man," his daughter said.

He was a sports enthusiast -- an avid golfer and steady fan of University of Texas El Paso basketball.

He played high school and college football, attending Texas Western College, which is now UTEP.

"I think he wanted to be a coach," his daughter said.

The family sold Tony Lama Co. to Justin Brands in the 1990s. The brand is still made today.

A funeral will be held Thursday afternoon in El Paso, the Times said.

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