The US central bank has left its key interest rate unchanged again, while it looks for more evidence that inflation is coming under control.

The decision kept the target range for the Federal Reserve’s influential rate in the range of 5.25 per cent to 5.5 per cent, the highest in more than two decades.

The Fed is debating whether higher borrowing costs have done enough to ease the pressures pushing up prices.

Officials said they still expected to cut rates by the end of the year.

But after raising borrowing costs aggressively in response to soaring prices in 2022, the bank is proceeding cautiously.

Fed chairman Jerome Powell said at a press conference after the Fed’s meeting, that they want to be careful and fortunately with the economy growing, the labour market strong and inflation coming down, they can.

The Fed’s move comes a day before the Bank of England will announce its own interest rate decision. It is also expected to hold UK interest rates where they are, at 5.25 percent, a 15-year high.

Higher interest rates in theory work to cool inflation by make borrowing more expensive, slowing the economy and easing the pressures pushing up prices.

But if left in place for too long, they risk triggering a harsh economic slowdown.