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The Federal Reserve will keep interest rates unchanged for now, according to a statement from the Federal Open Market Committee at its annual two-day policy meeting.
The FOMC's comments matched forecasting by the majority of economists, who had set odds of a September rate hike at around 18 percent due to a sluggish economy, with inflation far below the central bank’s 2 percent goal.
"The committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives," said the FOMC statement.
"Although the unemployment rate is little changed in recent months, job gains have been solid, on average," it continued. "Household spending has been growing strongly but business fixed income has remained soft."
While the markets may have been in agreement that there would be no rate hike until December, the Fed itself has come under intense scrutiny for its internal division and mixed messages on the topic. Three FOMC members dissented from Wednesday's official statement, and several Fed policymakers have recently spoken out: Atlanta Fed President Dennis Lockhart announced last week that there should be a “serious discussion” about a rate hike, but Fed Governor Lael Brainard said she needed more sign of higher inflation before committing to any tightening.
The Fed has two more meetings this year, on November 1 and December 13, though it is widely believed that Fed Chair Janet Yellen is unlikely to raise rates just days before the Presidential election.
The U.S. central bank last raised the interest rate in December 2015, to a range of 0.25 percent to 0.50 percent.