Here’s everything to expect from the Fed that will move markets on Wednesday

The Federal Reserve, the central bank of the United States, is facing a dilemma as it attempts to rein in persistently high inflation while avoiding an economic recession.

The Fed has raised interest rates rapidly in recent months, but inflation has not yet retreated to the central bank’s target of 2%.

This has put the Fed in a predicament, as further interest rate increases could slow economic growth and potentially trigger a recession.

As a result, the Fed is expected to maintain its current interest rate range of 5.25%-5.5% at its meeting this Wednesday.

This decision suggests that the Fed believes that inflation remains a significant threat and that further rate increases are still necessary.

However, the Fed is also aware of the potential risks of raising rates too aggressively.

Concerns about the impact on economic growth and financial markets have led some Fed officials to express caution about the pace of future rate hikes.

In addition to interest rates, the Fed is also expected to announce a reduction in its balance sheet runoff.

The balance sheet runoff, which involves selling Treasury bonds and mortgage-backed securities, has been draining money from the financial system and putting upward pressure on interest rates.

A reduction in the pace of runoff would signal a willingness by the Fed to provide more support to the economy.

Overall, the Fed’s decision this Wednesday will be closely watched by markets and policymakers as they try to navigate the difficult task of balancing the fight against inflation with maintaining economic growth.