Patient Fed freezes its low rates

America's central bank last night confirmed its strategy of underpinning the gathering economic recovery with rock-bottom borrowing costs when it kept interest rates unchanged at a 46-year low of 1%.

Promising it would be "patient" before raising rates again, the board of the US Federal Reserve voted unanimously for the rate freeze, as arctic conditions descended on America's east coast.

In a statement after the meeting, the Fed said the risks of a build-up in inflationary pressures were evenly balanced with the risks of a drop in prices - the same position it adopted following its December meeting.

But the statement omitted last month's reference to keeping rates low "for a considerable period", a sign that the Fed is preparing the markets for a rate rise later this year, anlaysts said.

"It may just be a matter of linguistics, but the market is taking it as a sign that a change in policy is closer now than it appeared to be before the meeting," said Gary Thayer, chief economist at A G Edwards & Sons, St. Louis, Missouri.