The US Federal Reserve is expected to keep interest rates unchanged later as speculation swirls on who will be its next leader, but the US central bank will likely point to a firming economy as it edges closer to a possible rate rise next month.

The Fed has raised rates twice since January and currently forecasts one more hike by the end of the year as part of a tightening cycle that began in late 2015.

Investors have all but ruled out a move at the end of this week's two-day policy meeting. The Fed is due to issue its latest policy statement at 6pm Irish time.

Markets will look to it for confirmation the central bank is on track for a December rate hike, though attention will quickly turn to who will be in charge of monetary policy at the end of Fed Chair Janet Yellen's first term in February 2018.

President Donald Trump, who has interviewed Yellen, Fed Governor Jerome Powell and three others for the top Fed job, is likely to announce the nomination tomorrow.

Mr Powell, a soft-spoken centrist who has supported Ms Yellen's gradual approach to raising rates, is seen as having a lock on the position.

"The bottom line is the meeting is probably going to be a somewhat boring event for markets, overshadowed by the expected Fed chair decision," said Torsten Slok, chief international economist for Deutsche Bank.