The possible policy shift occurred at a meeting at which the Fed also resumed debate on how best to manage short-term interest rates in the future, a decision that could influence the final target size of the Fed's still-massive balance sheet.
A mistake in communication may have made investors think the Federal Reserve is adopting a looser monetary policy, following a speech by chair Jerome Powell on November 28.
His speech to the Economic Club of NY sent markets soaring more than 600 points on Wednesday.
"Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy - that is, neither speeding up nor slowing down growth", Powell said in a speech at the Economic Club of NY on Wednesday.
The U.S. central bank in 2018 has hiked rates each quarter, and is expected to tighten policy again next month.
Analysts think a rate hike next month is all but certain, in part because they think the Fed doesn't want to appear to be bowing to pressure from Trump. "This was again on display today", RBC Capital Markets chief USA economist Tom Porcelli wrote in a note.
During the Fed's November meeting, participants discussed a number of risks that could sweep away their rosy economic outlooks and change the path of policy, including "high levels of uncertainty" over the impact fiscal and trade policies on growth and inflation. Why should he? The data for the U.S. economy remains strong.
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Participants agreed that an additional rate increase was "likely to be warranted fairly soon".
Mr Trump blames Mr Powell for the rate hikes that he claims are undermining his economic and trade policies. Last month, Mr Powell said the Fed still had a "long way" to go before it reached that equilibrium. Instead he highlighted a new financial stability report the Fed published earlier on Wednesday. "We will be paying very close attention to what incoming economic and financial data are telling us". The first is that we will hear from Powell more often.
The Fed members' comments initially appeared to comfort investors.
Eventually, the FOMC determined that a December interest rate hike was appropriate. "The market is putting too much weigh on the dovish arguments here; I don't think that is what he meant to signal". "Certainly, all meetings are live now".
The speech signalled a move away from past statements.
"What do you do?" said Powell in NY. The Fed's benchmark federal-funds rate since then has been between 2% and 2.25% - or just below the lowest estimate.
October's Wall Street sell-off and a rise in bond yields tightened financial conditions while some sectors most sensitive to interest rates, such as the housing sector, had already begun to slow. Three of those increases have been under Powell.
The Fed raised its benchmark rate in March, June and in September, with the last increase putting it in a range of 2 percent to 2.25 percent. The president has blamed the Fed for the steep two-month fall in the stock market and the possibility that his efforts to boost growth with a major tax cut will be thwarted by rising interest rates.