US Federal Reserve keeps interest rates at 23-year high

The U.S. Federal Reserve on Wednesday held interest rates steady for a sixth straight meeting, keeping the level at a 23-year high to fight stubborn price increases.

After a two-day gathering, the central bank decided unanimously to keep the benchmark lending rate unchanged at 5.25-5.50 percent, citing a "lack of further progress" towards its two percent inflation target.

"The economic outlook is uncertain, and the Committee remains highly attentive to inflation risks," the Fed said in a statement.

For months, the U.S. central bank has held its benchmark lending rate at a high level to cool demand and rein in price increases — with a slowdown in inflation last year fueling optimism that the first cuts were on the horizon.

But inflation has accelerated, throwing cold water on hopes of an early rate reduction.

The Fed said it does not expect to lower rates until it has "greater confidence" that inflation is moving sustainably towards its target.

Federal Reserve Chair Jerome Powell told a press conference: "It is likely that gaining such greater confidence will take longer than previously expected."

While the central bank is prepared to hold rates steady for as long as appropriate, Powell added that it is "unlikely that the next policy rate move will be a hike."

 Possible cuts? 

The Fed's statement does not significantly change the general outlook that a first rate cut will likely occur in September, said economist Ryan Sweet of Oxford Economics.

This is contingent upon inflation slowing, he added.

While markets see a September cut "as a coin flip," a few good inflation reports could change the narrative, Sweet said.

Wednesday's statement also "contains no hawkish...