The US Federal Reserve, its central bank, held off on further hikes to the Federal Funds Rate, refusing to continue raising interest rates, after the two-day meeting of the Federal Open Market Committee concluded yesterday.

However, the FOMC did not rule out another cut this year. Chairman of the Federal Reserve, Jerome Powell conceded that the FOMC has not been convinced that they have done enough to bring inflation down to their target goal of two per cent, in an effort to restore price stability.

But they will assess the full range of economic data again in December in their final meeting of the year before making their next decision.

Mr Powell said the slowing down of the tightening is to allow the previous cuts to have their full effect on the economy.

The FOMC decided to maintain the target range for the federal funds rate at 5.25 per cent to 5.5 per cent.

The FOMC said in a statement: “In determining the extent of additional policy firming that may be appropriate to return inflation to 2 per cent over time, the committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.

“In addition, the committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities, as described in its previously announced plans.”

The FOMC added: “The committee is strongly committed to returning inflation to its 2 per cent objective.”

The statement noted that recent indicators suggest that economic activity expanded at a strong pace in the third quarter.

Job gains have moderated since earlier in the year but remain strong, and the unemployment rate has remained low. Inflation remains elevated.

It argued that the US banking system is sound and resilient. Tighter financial and credit conditions for households and businesses are likely to weigh on economic activity, hiring, and inflation.

The extent of these effects remains uncertain and the committee remains highly attentive to inflation risks.

The FOMC statement concluded: “In assessing the appropriate stance of monetary policy, the committee will continue to monitor the implications of incoming information for the economic outlook.

“The committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the committee's goals.

“The committee's assessments will take into account a wide range of information, including readings on labour market conditions, inflation pressures and inflation expectations, and, financial and international developments.”