The US Federal Reserve has held its main interest rate steady for the second time in a row.
As widely expected, the policy-setting Federal Open Market Committee voted to keep its overnight federal funds rate target at 5.25%, the level it reached in June after 17 straight increases stretching over more than two years.
The move is seen as giving the Fed more time to assess whether cooling economic growth will curb price pressures. The central bank said it was keeping open the possibility of additional rate hikes but noted that 'moderation in economic growth appears to be continuing, partly reflecting a cooling of the housing market'.
The Fed said after its last meeting that any future interest rate decisions would depend on economic data. The latest statistics on inflation appeared to confirm that inflationary pressures are easing. US consumer prices rose 0.2% in August and the widely watched core rate excluding food and energy increased at the same 0.2% pace.
Analysts say the sharp drop in energy costs in recent weeks will show up in future data, resulting in even tamer inflation figures. The US economy cooled to a 2.9% annual rate in the second quarter, down from 5.6% in the first quarter.
