It’s Fed Day, Here’s What to Watch

Early this morning, U.S. equity futures are mixed, but overall little changed, ahead of the Fed's highly anticipated monetary policy event this afternoon, quarterly results from General Mills and weekly data for mortgage applications. The market continues to anticipate the central bank taking no action today, a view we agree with, but as we discussed yesterday, the question is whether the Fed will pencil in one more rate hike later this year as it updates its fed funds forecast. This morning we are also hearing rumblings the Fed could dial back its forecast for the fed funds rate next year, signaling a smaller cut to rates than the 100-basis point cut in its June forecast.