The U.S. Federal Reserve is keeping its benchmark interest rate unchanged at 2%, indicating the U.S. central bank is taking a tough view of inflation.

While the decision issued by the central bank's Federal Open Markets Committee (FOMC) on Tuesday afternoon noted the strain in financial markets and slowing of economic growth in the U.S., it also expressed concern over inflation.

"Inflation has been high, spurred by the earlier increases in the prices of energy and some other commodities," the text of the decision states. "The Committee expects inflation to moderate later this year and next year, but the inflation outlook remains highly uncertain."

The committee added that it is concerned about the downside risks to growth and the upside risks of inflation -- language that shows the committee isn't eager to change rates unless conditions change fast.

Continued at Financial Post