When Federal Reserve policymakers meet Tuesday and Wednesday, they are expected to keep their key interest rate unchanged, but the gathering could reveal clues about where the Fed thinks inflation is heading, according to a report by the Associated Press.
This will be the Fed’s fourth meeting under new Chairman Kevin Warsh, who was President Donald Trump’s top choice to succeed Jerome Powell.
It also comes six days before the Midterm Elections, and given skepticism about Warsh’s independence from Trump, some observers believe the Fed will keep rates steady even after inflation rose last month.
The Fed is charged with keeping inflation low and employment high, so investors and economists will be looking for indications in the statement the Fed issues on Wednesday about where it thinks inflation is headed.
If the Fed thinks inflation is moving higher, it usually raises interest rates, and the cost of borrowing for consumers and businesses, to slow down the economy.
