The Fed has cut its growth forecast for 2014 due to the harsh winter weather.
The US central bank is now predicting growth of between 2.1% and 2.3% for this year, down from its March forecast of 2.8% to 3%.
In its accompanying statement, the Federal Reserve said that economic activity had “rebounded in recent months”.
As expected, the Fed has also trimmed back its stimulus program by $10 billion a month to $35 billion.
The central bank has been buying bonds to keep long-term interest rates low and encourage banks to lend.
This is the fifth cut in purchases since December and it is expected to stop buying bonds altogether by the autumn.
However, Fed chairman Janet Yellen stressed that this was not a pre-set program and if necessary it would change course.
As far as interest rates go, the bank said they would remain near zero “for a considerable time” after the bond buying ends.
On inflation, Janet Yellen said she expected it to remain at or below the target of 2% until the end of 2016. Low inflation would enable the bank to keep interest rates low. Currently, they are not expected to rise until the middle of 2015.
The Fed expects growth to pick up again in 2015, sticking to its prediction of 3% to 3.2% expansion.
“Economic activity will expand at a moderate pace and labor market conditions will continue to improve gradually,” the central bank said.
“Household spending appears to be rising moderately and business fixed investment resumed its advance.”
Janet Yellen added in a press conference afterwards that “over the next two years, the projections for real GDP growth remain somewhat above the estimates of longer-run normal growth”.