The Federal Reserve marked Alan Greenspan's final day as chairman by raising interest rates for the fourteenth time in succession, up 0.25 per cent to 4.5 per cent.
Shares fell and the dollar slid against the euro on the announcement, which was accompanied by a statement that said "although recent economic data have been uneven, the expansion in economic activity appears solid".
Mr Greenspan's last federal reserve board meeting came yesterday as the US Senate confirmed former Princeton economics professor Ben Bernanke as his successor.
The federal board statement yesterday offered Mr Bernanke some leeway for policy change, softening recent language on the need for higher rates in the future.
"The committee judges that some further policy firming may be needed to keep the risks to the attainment of both sustainable economic growth and price stability roughly in balance. In any event, the committee will respond to changes in economic prospects as needed to foster these objectives," the statement said.
Wall Street investors have appeared edgy in recent days at the prospect of change at the top of the Fed, not least because such changes have produced market turbulence in the past.
Mr Greenspan had been at the Fed for only two months when the stock market crashed in October 1987 and when his predecessor Paul Volcker took over in 1979 he had to move quickly as an inflation-wracked economy headed toward recession after the 17-month tenure of William Miller.
In his confirmation hearings before the Senate, Mr Bernanke promised to maintain continuity with Mr Greenspan and the Fed is widely expected to raise rates again on March 28th when the new chairman chairs his first interest rate setting meeting.
Unemployment and inflation are lower than when Mr Greenspan took office 18 years ago and the US has experienced its longest-ever economic expansion, interrupted by just two mild recessions.
Mr Greenspan's legacy will be difficult, if not impossible to replicate because the outgoing Fed chairman avoided theories and left behind no "Greenspan doctrine".
Mr Greenspan has described his approach as "risk management", taking smaller risks in order to avoid bigger threats.
Mr Bernanke lacks Mr Greenspan's business experience and is an unfamiliar figure on Wall Street but his academic distinction and experience as President George W Bush's top economic adviser should help him to communicate the Fed's message.
The new Fed chief takes over amid signs that the US economy is slowing down.
Yesterday's interest rate rise followed news from the US commerce department that Americans' personal savings rate was negative in 2005 for the first time since the 1930s Great Depression.
Last year's savings rate was minus 0.5 per cent, which means that Americans spent all their after-tax income and dipped into savings or borrowed more.
