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The Federal Reserve held interest rates steady on Wednesday but signaled that rates could fall in the coming months if inflation continues to cool.
Policy makers have kept their benchmark interest rate between 5.25% to 5.5% — the highest in over two decades — since July.
In its post-meeting policy statement, the Fed's rate-setting committee replaced a reference to possible future rate hikes with a more neutral reference to "adjustments" in interest rates.
Still, policymakers added a note of caution.
"The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%," the policy statement said.
The Fed has been pleasantly surprised by the rapid drop in inflation in recent months.