Fed Faced with High Stakes Rate Hike Decision

The US Federal Reserve is set to meet this week to discuss potential rate hikes amidst high inflation.

Markets are expecting a 25-basis-point increase, with over 85% probability according to FedWatch, after recent data showed consumer inflation remaining steady at 3.4% for the second month in a row.

The Fed has held rates steady since January, but several policymakers, including Kevin Warsh, have hinted that if inflation does not show signs of slowing, they will need to act with rate hikes.

This decision is seen as a test for Warsh, who was appointed by President Donald Trump and must balance the markets' expectations with potential backlash from the White House.