Inflation is also snapping into line, with fresh projections from policymakers on Wednesday indicating it would run above the central bank's 2 percent target, hitting 2.1 percent this year and remaining there through 2020.
The Fed has raised rates seven times since late 2015 on the back of the economy's continuing expansion and solid job growth, rendering the language of its previous policy statements outdated.
Fed officials expect to raise interest rates at least once more in 2018 and had been split on a possible fourth hike in their last meeting.
Fed Chairman Jerome Powell will hold a press conference at the conclusion of the two-day June meeting. Should the Fed's expectations prove accurate, its rate policy would then be meant to slow the economy.
The new median forecast projects the Fed's benchmark rate at 3.1 percent by the end of 2019, up from 2.9 percent in the previous forecast. While the national economy appears to be on solid ground for 2018, the Fed must now consider how growing global trade disputes could slow US growth.
The Fed now sees gross domestic product growing 2.8 percent this year, slightly higher than previously forecast, and dipping to 2.4 percent next year, unchanged from policymakers' March projections.
Following the Fed's rate decision, the FOMC releases its statement regarding monetary policy. Unemployment is already at 3.8 percent, the lowest since 2000, and the Fed believes it will fall to 3.6 percent by the end of the year, which would be the best rate since the 1960s.
Powell faces a tricky balancing act as the Fed attempts to bring interest rates toward historical averages.
Fed says setting ioer rate 5 basis points below top of target range for funds rate aims to keep market rates well within range. While Japan's central bank isn't expected to make any major policy shifts, anticipation is rising that the ECB may outline as early as this week plans to begin paring its bond-buying stimulus program as a prelude to ending them altogether.