The Federal Reserve has kept interest rates unchanged at 0.25 to 0.5 per cent in its March meeting as a result of worries about global growth.
In its latest monthly meeting, the Federal Open Market Committee said: “The committee is closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation, and for the balance of risks to the outlook.”
However, the central bank said its future moves will be gradual and expects the funds rate to remain below expected levels “for some time”.
The Fed remained upbeat on the outlook for the US economy.
In a statement it said: “Information received since the Federal Open Market Committee met in January suggests that economic activity has been expanding at a moderate pace despite the global economic and financial developments of recent months.
“Household spending has been increasing at a moderate rate, and the housing sector has improved further; however, business fixed investment and net exports have been soft.”
“The committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will continue to strengthen. However, global economic and financial developments continue to pose risks.”
Expectations for higher US interest rates have tumbled over the past few months, as shown by the Fed Funds futures market.
These estimates now predict the US central bank will hold rates through the end of 2016, with an increase coming in the first quarter of 2017.
In December the US central bank moved rates up from the target rate of between 0 and 0.25 per cent, which they had been at since November 2008.