The 33-year-old striker has helped the Terriers go on a five-match unbeaten run since joining from Wigan Athletic, scoring once and providing two assists.
He will remain with them for 11 further Championship matches after agreeing to extend his stay.
"I'm delighted that we've managed to secure the services of Grant for the rest of 2014," Huddersfield manager Powell told his club's official website.
"His initial time at the club has been a great success; he's had an immediate impact on the team and has played a role in our unbeaten five-game run. Although that run is down to every player, rather than solely Grant, it is fair to say he has been a catalyst.
"We quickly made it clear to Grant that we wanted to extend his loan at the club, but then the decision was out of our hands. Thankfully, a lot of hard work has gone on behind the scenes to agree the deal with Wigan and Grant has subsequently decided he's enjoying his football and wants to stay."
Holt has played just once for Wigan since December 2013 following a fallout with manager Uwe Rosler.