WASHINGTON (AP) — The Federal Reserve is raising its benchmark interest rate and signaling that it is sticking with a gradual approach to rate hikes under its new chairman, Jerome Powell.

The Fed is boosting its key short-term rate by a modest quarter-point to a still-low range of 1.5 percent to 1.75 percent and will keep shrinking its bond portfolio. Both steps show confidence that the U.S. economy remains sturdy nearly nine years after the Great Recession ended. The actions mean consumers and businesses will face higher loan rates over time.

The Fed's rate hike marks its sixth since it began tightening credit in December 2015. It is sticking with the forecast it issued in December for three increases in 2018. But it did boost its 2019 estimate from two hikes to three.