The central bank left its main interest rate unchanged at the unprecedented low of 0 to 0.25 per cent, which is what most economists had expected.
The rate-setting Federal Open Markets Committee (FOMC) opted to hold the federal funds rate in the current range, first set in December 2008.
A statement from the committee said that the latest data on the US economy, although generally more positive than that of last month, painted a mixed picture of the recovery from recession.
However, FOMC member Thomas Hoenig dissented, saying the phrase "an extended period" should be removed as exceptionally low rates tend to cause economic imbalances.
At its regular policy meeting, the Fed said it would stop its policy of buying up mortgage-backed securities to support mortgage lending, which it had been doing to stimulate the housing market.
US markets reacted positively to the news, with the Dow Jones Industrial Average rising 30 points following the announcement.
In the UK, the Sterling rose by 1.2 per cent against the dollar to $1.5234, while the euro rose 0.6 per cent to $1.3756.
