Federal Reserve policymakers are meeting in Washington to discuss interest rates, with many expecting them to remain unchanged despite high inflation. The Fed has been struggling to bring inflation down to its 2% target, with inflation exceeding that target for over five years.

Inflation Concerns

New Fed Chair Kevin Warsh has expressed his frustration with inflation, stating that he has “no tolerance” for elevated inflation. However, the Fed may not be ready to take action just yet, with many expecting a rate hike in September instead.

The Iran war and rising oil prices are also contributing to inflation concerns. The conflict has caused disruptions to oil supplies, leading to higher energy prices. Fed policymakers are faced with the challenge of balancing the need to control inflation with the risk of disrupting financial markets.

Economic Data

The Commerce Department is set to release economic data on Thursday, including the first look at April-June economic growth and the Fed’s preferred inflation measure, the personal consumption expenditures (PCE) price index, for June. This data will likely play a significant role in the Fed’s decision-making process.

Only 29% of Wall Street traders predict that the Fed will raise rates this week, but 76% foresee a rate hike in September. The Fed’s decision will have significant implications for the economy, and policymakers must carefully consider their options.

Original reporting: Dallas TX News (HLL/CB) — read the source article.