The Federal Reserve raised its benchmark lending rate a quarterpoint and continued to project two more increases this year,signaling more vigilance as inflation approaches its target.

“In view of realized and expected labor market conditions andinflation, the committee decided to raise the target range for thefederal funds rate,” the Federal Open Market Committee said in itsstatement Wednesday. “Near-term risks to the economic outlookappear roughly balanced.”

Investors had almost fully expected the increase to a range of0.75% to 1% following unusually clear signals from policy makersincluding Chairwoman Janet Yellen, who explained the committee'sthinking at a press conference in Washington.