A sharply divided Federal Reserve has cut its benchmark interest rate for a second time this year but declined to signal that further rate cuts are likely this year.
The Fed's move will reduce its benchmark rate - which influences many consumer and business loans - by an additional quarter-point to a range of 1.75 per cent to 2 per cent.
The action was approved 7-3, with two officials preferring to keep rates unchanged and one arguing for a bigger half-point cut. It was the most Fed dissents in three years.
The divisions on the policy committee underscored the challenges confronting chairman Jerome Powell in guiding the Fed at time of high uncertainty in the US economy.
US stock prices tumbled after the Fed issued its statement, reflecting disappointment that it had declined to indicate that more rate cuts are likely this year.
The Dow Jones Industrial Average was down 150 points an hour later.
The economic expansion appears durable in its 11th year of growth, with a still-solid job market and steady consumer spending.
But the Fed is trying to combat threats including uncertainties caused by US President Donald Trump's trade war with China, slower global growth and a slump in American manufacturing.
The Fed notes in a policy statement that "business fixed investment and exports have weakened".
The Fed's modest rate cut irritated Trump, who has attacked the central bank and insisted that it slash rates more aggressively. The president immediately signalled his discontent.
"Jay Powell and the Federal Reserve Fail Again," Trump tweeted.
"No 'guts,' no sense, no vision! A terrible communicator!"
Updated economic and interest rate forecasts issued on Wednesday by the Fed show that only seven of 17 officials foresee at least one additional rate cut this year.
And at least two Fed officials expect a rate hike next year.
None of the policymakers foresee rates falling below 1.5 per cent in 2020 - a sign that the turbulence from a global slowdown and Trump's escalation of the trade war is viewed as manageable.
Australian Associated Press