The Federal Reserve has held interest rates steady at its first policy meeting of the year, with the head of the US central bank pointing to continued moderate economic growth and a “strong” job market, and giving no sign of any imminent changes in borrowing costs.

“We believe the current stance of monetary policy is appropriate to support sustained economic growth, a strong labour market and inflation returning to our symmetric two per cent objective,” Fed Chair Jerome Powell said at a news conference on Wednesday following the central bank’s unanimous decision to maintain the key overnight lending rate in a range of between 1.50 per cent and 1.75 per cent.

He noted signs that global economic growth was stabilising and diminishing uncertainties around trade policy, concern about both of which were key factors in the Fed’s decisions to cut rates three times last year.

But, he added, “uncertainties about the outlook remain, including those posed by the new coronavirus”.

The outbreak of the new flu-like virus in China has led to fears of a further slowdown in the world’s second-largest economy.

“We are very carefully monitoring the situation,” Powell said, adding that while the implications of the outbreak for China’s output are clear, it is “too early” to determine its global effect or impact on the US economic outlook.

The Fed’s statement, calling out solid job gains and low unemployment, was little changed from the one issued after its December meeting.

Powell did not give new guidance about its current practice of buying $US60 billion monthly of US Treasury bills to ensure adequate short-term liquidity in bank funding markets.

That program will remain in place at least into April, while a related offering of repurchase agreements will continue at least through April.

Fed policymakers have been discussing how and when to end the temporary Treasury bill purchases, which have been underway since October, and what sort of permanent replacement it could use to ensure the central bank keeps control of the federal funds rate.

Yields on US Treasury securities ground lower as Powell spoke, while benchmark US stock market indexes gave up most of their gains on the day. The dollar was largely flat against a basket of major trading partner currencies.