Fed leaves key rate unchanged but hints at upcoming hike

WASHINGTON (AP) — The Federal Reserve left interest rates unchanged today, six days before Americans choose a new president, but hinted again that it would likely raise rates soon.

The Fed said that the case for a rate hike has "continued to strengthen" but that it had decided to wait for more evidence of progress toward its objectives. Most analysts and investors expect a rate hike at the Fed's next meeting in mid-December.

The statement the Fed issued closely tracked its statement after its previous meeting in September, noting that the job market has continued to strengthen and that economic activity has picked up. The Fed had been widely expected to leave rates alone, in part to avoid any perception of affecting next week's vote.

In its latest statement, the Fed added the word "some" to its observation that it's prepared wait for "some further evidence" of progress toward its objectives. In the past, the use of "some" has sometimes been a signal that the Fed sees the hurdle for a rate hike as having moved lower.

"The bar for action has been moderately reduced with the insertion of the word 'some," ' said Carl Tannenbaum, chief economist at Northern Trust and a former Fed official.

In addition, the Fed's statement said the case for raising rates had "continued to strengthen," whereas in September, it had said only that the case "has strengthened."

Tannenbaum said the statement brings the Fed "one stop closer" to a rate hike.