The Federal Reserve on Tuesday called a halt to the longest unbroken run of interest rate hikes in recent history, leaving its benchmark rate unchanged at 5.25 percent.

"The Federal Open Market Committee decided today to keep its target for the federal funds rate at 5-1/4 percent," said the Federal Open Market Committee, the U.S. central bank's policymaking panel, in a statement.

The Fed's committee voted 9 to 1 to leave the federal funds rate steady, according to the statement.

Jeffrey Lacker, who preferred an increase of 25 basis points inthe federal funds rate target at this meeting, voted against the move, it said.

The U.S. Fed has increased short-term interest rates for 17 times since June 2004 and raised the federal fund rate to 5.25 percent.

"Economic growth has moderated from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices," the Fed explained the widely anticipated halt in the statement.

Meanwhile, the Fed also noted that readings on core inflation "have been elevated in recent months."

"However, inflation pressures seem likely to moderate over time,reflecting contained inflation expectations and the cumulative effects of monetary policy actions and other factors restraining aggregate demand," it said.

"Nonetheless, the Committee judges that some inflation risks remain," said the panel, adding the extent and timing of any additional rate hikes that may be needed will depend on incoming data on both inflation and economic growth.

Many analysts believe Fed Chairman Ben Bernanke and his colleagues will not raise interest rates at least for now, because of growing signs that the economy is cooling.

"I think the weakening economy will trump the fear of accelerating inflation and they (interest rates) will pause," predicted Mark Zandi, chief economist at Moody's Economy.com.

Bernanke raised expectations of a pause when he delivered the Fed's latest economic forecast to Congress last month, saying the central bank believed that a cooling economy would lower inflation pressures over the next two years.

Source:Xinhua