WASHINGTON, Nov. 1 (Xinhuanet) -- The US Federal Reserve decided Tuesday to boost the federal funds rate, the interest that commercial banks charge each other on overnight loans, by another one quarter percentage point to 4 percent, the highest level in more than four years.

    The decision was made at a regular meeting of the Fed's policy-making arm -- the Federal Open Market Committee. This was the 12th consecutive action that the central bank had taken to tighten credit since last June when the key short-term interest rate stoodat a 46-year low of one percent.

    Also, the central bank signaled more hikes are likely.

    As it did in the past, the Fed in its brief statement following Tuesday's decision said that it believes future interest rates canoccur "at a pace that is likely to be measured".

    That language is seen as a signal that the Fed plans to keep raising rates at a gradual pace of quarter-point moves at coming meetings. There is one more meeting this year to be held on Dec. 13. Next year's first meeting is scheduled on Jan. 31.

    "Elevated energy prices and hurricane-related disruptions in economic activity have temporarily depressed output and employment," the Fed said in the statement.

    However, monetary policy accommodation, coupled with robust underlying growth in productivity, is providing ongoing support to economic activity that will likely be augmented by planned rebuilding in the hurricane-affected areas, it said.

    The Fed said that "The cumulative rise in energy and other costs have the potential to add to inflation pressures; however, core inflation has been relatively low in recent months and longer-term inflation expectations remain contained."

    "With underlying inflation expected to be contained," the Fed said that it "believes that policy accommodation can be removed at a pace that is likely to be measured."

    Nonetheless, the Fed also said it will respond to changes in economic prospects as needed to fulfill its obligation to maintainprice stability.

    In a related action, the Fed increased the discount rate by a quarter-point to 5 percent, according to the statement. Enditem