The United States Federal Reserve is expected to raise its benchmark interest rate three times in 2018 while adopting two more hikes through this year. The central bank left monetary policy unchanged after the Federal Open Market Committee (FOMC) meeting on May 3, as was widely expected.

The implication of a largely unchanged statement is that a rate hike on June 14 is still very much on the cards. Notably, the Fed said that the slowing of Q1 economic growth is "likely to be transitory". A range of Fed speakers since that meeting has reaffirmed its intention to raise interest rates twice more this year.

Markets are pricing a high probability of over 90 percent of a June rate rise, according to Fed funds futures on Bloomberg, but are less convinced of a further rise in the second half of the year.

"We expect the Fed to raise policy rates two more times this year, in June and September, to 1.50 percent and three times in 2018 to 2.25 percent," Lloyds Bank commented in its latest research report.

With interest rate rises well under way, the Fed is expected to start unwinding its asset holdings built up as a result of its QE policy. This could be achieved by tapering reinvestments of maturing assets, potentially starting as early as the back end of this year. Meanwhile, more details will be forthcoming in the coming months, with concrete proposals possibly emerging after the September FOMC meeting.