American interest rates went up by another quarter-point last night to a four-year high of 3.5 per cent for the benchmark federal funds rate.
Announcing a unanimous vote by its Open Market committee, the US Federal Reserve made it clear that there is more to come.
It said rates are still low enough to lend support to the economy, repeating that it expected to continue to remove this stimulus at a "measured" pace, a phrase taken to indicate that the cost of borrowing will continue to be raised by a quarter point at a time.
In an effort to head off inflation in a growing economy, the Fed began in June last year to push up the federal funds rate that banks charge each other for overnight loans from a low of one per cent.
It has now been raised on ten successive occasions. US economists expect it to hit four per cent or higher by the year-end.
" Aggregate spending, despite high energy prices, appears to have strengthened since late winter, and labour market conditions continue to improve gradually," the Fed said explaining its decision.
"Core inflation has been relatively low in recent months and longer- term inflation expectations remain well contained, but pressures on inflation have stayed elevated."
Last night's increase comes after data showing the US economy quickening, despite record energy prices and climbing short-term borrowing costs.
The US economy grew at the annual equivalent of 3.4 per cent in the second quarter of this year, only a touch slower than in the first quarter.