FILE - In this Wednesday, Sept. 20, 2017, file photo, Federal Reserve Chair Janet Yellen gets up from her seat at the conclusion of a news conference following the Federal Open Market Committee meeting in Washington. Yellen, the first woman to lead the world’s most influential central bank, will step down when her term expires on Feb. 3, 2018. She will be succeeded by Fed board member Jerome Powell. (AP Photo/Pablo Martinez Monsivais, File)

FILE - In this Wednesday, Sept. 20, 2017, file photo, Federal Reserve Chair Janet Yellen gets up from her seat at the conclusion of a news conference following the Federal Open Market Committee meeting in Washington. Yellen, the first woman to lead the world’s most influential central bank, will step down when her term expires on Feb. 3, 2018. She will be succeeded by Fed board member Jerome Powell. (AP Photo/Pablo Martinez Monsivais, File)

The Federal Reserve has left its benchmark interest rate unchanged but signaled that it expects to resume raising rates gradually to reflect a healthy job market and economy.

At Janet Yellen’s final meeting as chair Wednesday, the Fed kept its key short-term rate in a still-low range of 1.25 percent to 1.5 percent. It said in a statement that it expects inflation to finally pick up this year and to stabilize around the Fed’s target level of 2 percent. In its previous statement, the Fed had predicted that inflation would remain below its target rate.

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The Fed also indicated that it thinks the job market and the overall economy are continuing to improve.

“Gains in employment, household spending and business fixed investment have been solid,” its statement said.

The central bank said it expects the steadily strengthening economy to warrant further gradual increases in its benchmark rate. Those additional rate hikes would likely lead, in time, to higher rates on some consumer and business loans.

The Fed’s policy statement was approved by a 9-0 vote.

Yellen has led a cautious approach to rate increases in her four years as chair, and Jerome Powell, who will succeed her next week, has indicated he favors a similar approach.

“The Yellen era ends with a yawn,” said Gus Faucher, chief economist at PNC. “Yellen’s tenure has been largely successful, with the unemployment rate falling to a 17-year low.”

The Fed modestly raised its key rate three times in 2017, and most economists expect the Powell-led Fed to do so at least three additional times this year beginning in March. Powell has been a Yellen ally and among the Fed’s consensus-builders in 5½ years on the central bank’s board.

The unemployment rate is just 4.1 percent, and the economy expanded at a solid 2.6 percent annual rate in the October-December quarter, helping lift growth for all of 2017 to a decent 2.3 percent.

Synchronized growth in major regions across the world has helped energize the U.S. economy. And the sweeping tax overhaul that President Donald Trump pushed through Congress last month is expected to further support U.S. growth.

The Fed’s next scheduled policy meeting in March, when most economists foresee the next rate hike, will be the first time that Powell is scheduled to hold one of the Fed leader’s quarterly news conferences.

In a separate statement Wednesday, the Fed said Powell would be sworn in on Monday. Last week, the Senate confirmed Trump’s nomination of Powell to be Fed chairman.

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Economists are roughly divided on whether they think Fed’s policymakers will raise rates three times this year, as in 2017, or four times. The pivotal factor will likely be how inflation performs. For the past six years, inflation has been a no-show, running below even the Fed’s target level of 2 percent.

A tight job market, with pressure building for pay increases, and potentially higher consumer and business spending resulting from the Republican tax cuts, could accelerate inflation this year. The prospect of faster inflation could, in turn, lead the Fed to step up its rate hikes.

The Fed has modestly raised its benchmark rate five times since December 2015, when it began tightening for the first time since the height of the financial crisis in 2008. When the crisis erupted, the Fed cut its rate to a record low near zero to help rescue the financial system and the economy and then held it there for seven years.

This year, the lineup of Fed regional bank presidents who vote on the central bank’s rate policy — a list that rotates annually — is expected to be somewhat more “hawkish” this year. Fed hawks are those who are less likely to favor low rates to maximize employment and more likely to back rate hikes to prevent future high inflation.

Powell, a lawyer and investment manager by training, will be the first Fed leader in 30 years not to hold a Ph.D. in economics. Trump chose Powell for the post rather than offer Yellen a second term despite widespread praise for her performance as chair.

With Yellen’s departure, the seven-member Fed board will have four vacancies. Marvin Goodfriend, a conservative economist, has been nominated by Trump for one of the vacant board seats. Trump has yet to make nominations for the others.