The Federal Reserve stayed on course for further increases in short-term interest rates, with the next move widely expected as soon as December, as the central bank attempts to keep the economy on an even keel as the labour market strengthens rapidly.

The Federal Open Market Committee kept its target range at 2-2.25 per cent on Thursday, and gave a bullish verdict on the US economy, noting that unemployment had dropped further as growth in economic activity and household spending remained strong. Investment growth, the committee noted, has decelerated compared with earlier this year.

The rates decision by the Fed, chaired by Jay Powell, comes as the central bank continues its gradual march to tighter monetary policy. Wage growth has accelerated to its quickest pace in almost a decade, job gains are averaging more than 200,000 a month, unemployment is hovering at multi-decade lows, and the economy has recorded two straight quarters of annualised growth well in excess of 3 per cent.