US Fed holds rate steady, signals three cuts ahead in 2024

Key lending rate to stay between 5.25% and 5.5% in efforts to slow inflation to 2%

WASHINGTON - The United States Federal Reserve voted on Dec 13 to hold interest rates at a 22-year high for the third straight meeting, and signalled that it expects to make three cuts in 2024.

The Fed's decision to keep its key lending rate between 5.25 per cent and 5.5 per cent lets policymakers determine "the extent of any additional policy firming that may be appropriate", the US central bank said in a statement.

The inclusion of the word "any", which was absent in November's decision, is likely to further dampen lingering expectations of interest rate hikes ahead - and fuel traders' hopes of cuts.

Lower interest rates make borrowing cheaper and help to encourage consumer spending, which is good news for company earnings.

The widely expected decision keeps interest rates high as the Fed continues its fight to slow inflation towards its long-term target of 2 per cent amid a recent flurry of positive economic news.

The Fed, which has a dual mandate to tackle both inflation and unemployment, is the first major central bank to unveil its interest rate decision this week.