Fed Expected to Hold Fire on Interest Rates This Week

The Federal Reserve is likely to keep interest rates unchanged at its upcoming meeting on Tuesday and Wednesday. This decision comes despite inflation rates being above the Fed's target of 2% for more than five years, a long-standing issue that new Fed Chair Kevin Warsh has expressed frustration about.

Analysts Joseph Egelhof and Guneet Dhingra from BNP Paribas Securities believe the Fed may choose to wait until its fall meeting before raising rates. They argue that a hike now could disrupt financial markets, which are not currently anticipating an increase in interest rates.

The Fed's decision will be influenced by upcoming economic data releases, including the Commerce Department's report on April-June economic growth and personal consumption expenditures (PCE) price index on Thursday.