The Federal Reserve is expected to leave interest rates unchanged tonight while signaling a gradual tightening of monetary policy later this year as the US economy continues to expand and job gains remain solid. 

Investors will focus on the Fed's gauge ofinflation, which remains stubbornly below its 2% target, the risks it sees to its economic outlook, and any assessment of the impact of the Trump administration's tax overhaul on growth. 

The Fed is due to release a statement at the end of it slatest two-day policy meeting later tonight. 

The policy meeting is Fed Chair Janet Yellen's last as head of the bank. 

The US economy has added about 10 million jobs and unemployment has fallen to a 17-year low of 4.1% during Yellen's four-year tenure while interest rates have slowly risen from the near-zero levels put in place to fight the 2007-2009 recession. 

Incoming Fed chief Jerome Powell has worked closely with Yellen and embraces her view that keeping rates on a slow upward path will allow unemployment to fall further, coaxing workers back into the labour force and fostering stronger wage growth. 

With the outset of the Powell era only days away, analysts do not expect a dramatic shift from the Fed today.