The US Federal Reserve on Wednesday sharply raised its forecast for inflation this year and provided the timeframe for when to raise interest rates.
However, the central bank gave no indication as to when it would begin to scale back its aggressive bond-buying program.
As expected, the policy-setting Federal Open Market Committee (FOMC) left the benchmark short-term borrowing rate steady near zero (0-0.25%).
But officials have indicated that the rate hike could come as soon as 2023, after they said last March that they would not see any increases until at least 2024.
Although the Fed raised its key inflation forecast to 3.4%, a full percentage point higher than its March forecast, the post-meeting statement continued to say inflation pressures are “temporary.”
Officials raised their forecast for GDP for this year to 7% from 6.5% previously. The unemployment estimate remained unchanged at 4.5%.