"I'm expecting that phrase to disappear for good in January as a sign investors should expect a summer initial rate hike," said Stuart Hoffman, chief economist with PNC Financial Services Group in an interview with TheStreet. "I think they are waiting to see how oil prices settle and how the holiday season and economic growth was in the fourth quarter, and I think they'll get good news on that."
Aside from leaving the "considerable time" phrase, the Fed rewarded investors with another vague term: patient. "Based on its current assessment, the Committee judges that it can be patient in beginning to normalize the stance of monetary policy," the Fed said in its statement.
Investors worry stocks will look less attractive once interest rates rise.
"The Fed decided to split the hair," Hoffman added. "They did come up with another phrase, 'be patient,' but then went on to say it's consistent with the 'considerable time' phrase, which they also left in, so they gave us two to choose from."
While the Fed didn't comment on the recent volatility in the markets or Russia's crumbling ruble, it did note falling inflation on the heels of low oil prices, but insisted that long-term inflation expectations remain the same.
"Near term, the headline inflation numbers will be low but the Fed doesn't believe that will last so they are making an implicit judgment that oil prices will bottom out this winter and therefore have a transitory impact on holding down inflation," Hoffman said.
Still, a rise in rates means the Fed thinks the economy is strong enough to be cut from its years of life support, which not only includes low interest rates, but trillions of dollars of bond stimulus. That would be a real milestone for what many consider a tepid economic recovery.
--Written by Scott Gamm in New York.