Full coverage: Fed to unwind bloated balance sheet, signals Dec rate hike

The interest rate outlook for next year remained largely unchanged, with three hikes envisioned

The US Federal Reserve has kept its interest rate unchanged on Wednesday but announced that it would start unwinding its $4.5-trillion balance sheet from October, a further step to end the loose monetary policy.

The central bank expected the Hurricanes Harvey, Irma and Maris to affect US economy in the near term, but would not alter the course of the economy in the medium term.

According to the Fed's economic projections, Fed officials expected the US economy to grow 2.4 per cent this year, higher than their forecast of 2.2 per cent in June.