US Federal Reserve keeps interest rate unchanged, says will be 'patient'

The Federal Reserve left the key US lending rate unchanged on Wednesday, and said it would be "patient" about making any further changes, in the clearest signal yet the central bank has heeded concerns about the economy. Although the Fed continues to expect continued expansion of the economy and strong jobs growth are the "most likely outcomes," the statement signaled the growing uncertainty about the outlook. "In light of global economic and financial developments and muted inflation pressures, the committee will be patient as it determines" the timing and need for any further increases, the policy-setting Federal Open Market Committee said.

In an unusual separate statement, the Fed also said it was prepared to change the pace of reduction of its massive securities holdings, after markets became concerned that the current process was too rigid.

The language used in the FOMC statement, keeping the benchmark interest rate in a range of 2.25 percent to 2.5 percent, reflected the increasing sense that the US economy may have peaked.

It cited "solid" economic growth, rather than a "strong rate of growth" highlighted in prior statements.

The decision at the Fed's first policy meeting of the year was expected after central bankers signaled strongly in recent weeks that they intended to tread cautiously about any further moves.

But the unusually dovish language likely will come as a surprise. Federal Reserve Chairman Jerome Powell will have an opportunity to explain the central bank's thinking in a news conference due to begin at 1930 GMT.