Overview

• Futures imply about a 96% chance of a 25 basis point cut at 2 p.m. ET, with Powell’s press conference at 2:30 p.m. expected to set expectations for the path of rates.
• Global markets have rallied on dovish hopes with U.S. stocks near records, the dollar softer and gold at all‑time highs, raising the risk of a sharp unwind if guidance is less supportive.
• Policymakers weigh a cooling labor market against inflation still above the 2% target, with recent tariffs lifting some prices; stronger‑than‑expected August retail sales did little to shift cut expectations.
• Strategists warn on perception risk, with JPMorgan’s David Kelly saying a move seen as bowing to political pressure could add risk for stocks, bonds and the dollar; SocGen flags potential declines if the Fed signals a slower easing path.
• Governance shifts frame the meeting as Stephen Miran was sworn in to the Fed board and a court blocked President Trump from firing Governor Lisa Cook, while markets price in additional cuts through next year.