By Frank Fuhrig

Washington (dpa) - The US Federal Reserve could hike its key interest rate Wednesday for the first time since the 2008 financial crisis.

The central bank's benchmark federal funds rate - which banks pay for unsecured overnight loans - has been set at an unprecedented range of zero to 0.25 per cent since December 2008.

But the baffling absence of inflation - in a US economy in recovery since 2009 and flooded with monetary stimulus - has been a key reason the Fed has so far refrained from interest rate hikes.

Last week, a Bloomberg News survey of 91 economists found "almost all" expecting the central bank to hike interest rates by 0.25 percentage points in its statement scheduled for 2 pm (1900 GMT) Wednesday, at the conclusion of the Fed's two-day meeting in Washington.

Fed Chairwoman Janet Yellen has strongly signalled that the long-awaited tightening of monetary policy could be at hand, warning in a December 2 speech of the risks from failing to tighten monetary policy.

Keeping monetary policy too low, too long could fuel asset bubbles "and thus undermine financial stability," she said.

The October and November US employment reports bolstered confidence in the trajectory of the economy, with the jobless rate down to 5 per cent from a post-crisis peak of 10 per cent in 2009.

Gross domestic product expanded during the July-September quarter at an annualized pace of 2.1 per cent according to the latest report, revised up from an initial estimate of 1.5 per cent.

The driving factors in US monetary policy are the labour market and inflation - the Fed's so-called dual mandate. The Fed, which has a long-range inflation target of 2 per cent, monitors a broad range of price gauges, including an index based on personal consumption.

Consumer prices were unchanged in November in the United States, the federal Bureau of Labour Statistics reported Tuesday. For the last 12 months, the consumer price index was up 0.5 per cent.

Continued falling energy prices balanced out higher costs in other sectors of the economy.

So-called core prices, which exclude volatile food and energy costs, rose 0.2 per cent last month, compared to October. For the last 12 months, core inflation was 2 per cent.