Fed holds interest rates steady

The Federal Reserve held interest rates steady on Wednesday and hinted at an upcoming hike in June.

The Federal Open Markets Committee, the Fed’s policymaking arm, said slowing economic growth was “likely transitory” and expected economic growth to expand at a “moderate” pace.

“The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate,” FOMC said, with a hike predicted to come in June.

{mosads}Analysts and traders widely expected the Fed to leave rates unchanged and keep to a forecast of two more potential hikes this year. The Fed raised rates 0.25 percent to a 0.75 to 1 percent target range in March, three months after another 0.25 percent hike in December.

The December 2016 hike was the central bank’s first in a year, following a December 2015 hike that ended almost a decade without rate increases.

The Fed is in the midst of bringing interest rates back toward historic averages after slashing them during the financial crisis. Fed policymakers have longed warned that low or near-zero interest rates would limit the central bank’s tools to handle a financial crisis.

Employment and inflation are also hovering near the Fed’s targets of roughly 5 percent and 2 percent respectively, and economic data has generally been strong, save for a disappointing March jobs report.