WASHINGTON, Dec. 12 (UPI) -- The U.S. Federal Reserve decided Tuesday to leave a key interest rate at 5.25 percent, as was widely expected, but hinted at future rate hikes.
With only one dissenting vote, the central bank's Federal Open Market Committee decided to keep its target for the federal funds rate steady even though it "judges that some inflation risks remain."
The FOMC said "the extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information."
Overall, the committee said economic growth has slowed this year, partly reflecting a substantial cooling of the housing market. It also said the economy seems likely to expand at a moderate pace on balance over coming quarters.
"Readings on core inflation have been elevated, and the high level of resource utilization has the potential to sustain inflation pressures. However, inflation pressures seem likely to moderate over time, reflecting reduced impetus from energy prices, contained inflation expectations, and the cumulative effects of monetary policy actions and other factors restraining aggregate demand."
