European shares rally towards multi-year highs, boosted by Fed
* FTSEurofirst 300 up 0.7 pct
* Fed less hawkish than expected - analysts
* Rolls Royce top riser after buyback
By Alistair Smout
EDINBURGH, June 19 (Reuters) - European shares rose in early deals on Thursday, boosted after the Federal Reserve said the U.S. economy was making progress and committed to retaining accommodative monetary policy over the long term.
The pan-European FTSEurofirst 300 rose 0.7 percent by 0741 GMT, tracking gains overnight on Wall Street and in Asia that saw the S&P 500 hit a new record high.
The Euro STOXX Volatility index, which measures how much investors have to pay to protect gains through options and is a crude indicator of investor fear, fell to its lowest since December 2006.
The gains were made after the Fed hinted at a slightly faster pace of interest-rate increases starting next year but suggested rates in the long run would be lower than it had indicated previously.
Expectations had been building that the Fed would take a more hawkish view in order to tackle inflation that was higher than anticipated. Continuación...