US Fed leaves key interest rate unchanged

The US Federal Reserve kept interest rates unchanged and said it expected to start winding down its massive holdings of bonds "relatively soon".

The US central bank kept its benchmark lending rate in a target range of 1.00 per cent to 1.25 per cent and said it was continuing the slow path of monetary tightening that has lifted rates by a percentage point since 2015.

In a statement, the Fed's rate-setting committee indicated the economy was growing moderately and job gains had been solid. But it noted that both overall inflation and a measure of underlying price gains had declined and said it would "carefully monitor" price trends, BNN reported.

"The committee expects to begin implementing its balance sheet normalization program relatively soon," the Fed said, adding that it would follow a plan outlined in June.