The Dow closed up 430 higher after the Federal Reserve said it will keep interest rates near zero until mid-2013.

In a Tuesday news release, the Federal Open Market Committee (FOMC) said information received since it last met in June shows the U.S. economy has been growing “considerably slower” than it expected.

“Indicators suggest a deterioration in overall labor market conditions in recent months, and the unemployment rate has moved up.  Household spending has flattened out, investment in nonresidential structures is still weak, and the housing sector remains depressed,” the FMOC said, also noting temporary factors such as the supply chain disruption from the disasters in Japan, accounting for “some of the recent weakness.”

The statement was highly anticipated following a Monday’s dramatic downturn. The Dow fell 634 points Monday after Standard & Poor’s downgraded the U.S.’s AAA credit rating to AA+.