The US Federal Reserve voted to hold interest rates on Wednesday despite White House pressure to lower borrowing costs.

The Fed said it will keep its key lending rate between 3.5% to 3.75%, stating that economic activity in the US “has been expanding at a solid pace”.

There are signs the employment market is stabilising - job creation is sluggish but the unemployment rate has ticked lower. Policymakers are continuing to monitor the effect on the economy of three interest cuts last year.

Trump is soon expected to announce a replacement for Fed chair Jerome Powell, whom the president has frequently criticised for not reducing interest rates quickly enough.

Two Fed officials voted in favour of an interest rate cut - Stephen Miran, who is on leave from his post at the White House where he leads Trump’s Council of Economic Advisers, and Christopher Waller, a Trump appointee whose name has been floated as contender to succeed Powell.