The Fed kept its benchmark interest rate near zero on Wednesday, but said it could raise rates earlier than expected and sharply cut its economic forecasts for this year.

The Federal Open Market Committee (FOMC) released its latest interest rate decision on Wednesday local time, leaving the benchmark interest rate unchanged in the range of 0% 0.25%, in line with market expectations.

The Fed statement said it may soon slow the pace of bond purchases. The rise in inflation largely reflects temporary factors.

"if things go roughly as expected, the committee believes that the pace of asset purchases may slow soon," the statement said. " But there is no indication when this will happen.

In addition, most committee members now believe that the first rate hike will take place in 2022. When the Fed released its economic forecasts in June, a slight majority of members thought the rate hike would take place in 2023.

According to the economic forecast released by the Federal Reserve, the median forecast for GDP growth from 2021 to 2023 is 5.9%, 3.8%, 2.5%, 7.0%, 3.3%, 2.4%, 4.8%, 3.8%, 3.5%, 4.5%, 3.8%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 3.5%, 4.5%, 3.8%, 3.5%, respectively. The median inflation expectations of core PCE from 2021 to 2023 are 3.7%, 2.3% and 3.1%, respectively, and are expected to be 3.0%, 2.1% and 2.1% respectively in June.