The US central bank has cut interest rates for a third time, despite concerns that the move will deliver a boost to the economy that risks re-igniting price inflation.

The decision was expected, setting the Federal Reserve’s key lending rate in a target range of 4.25% to 4.5%.

That is down a full percentage point since September, when the bank started lowering borrowing costs, citing progress stabilising prices and a desire to head off economic weakening.

Reports since then indicate the job market has been more resilient than expected while price rises have continued to bubble.