Fed Rate Decision Looms Amid Corporate Earnings Reports

The Federal Reserve's rate-setting committee is meeting on July 28-29 to discuss interest rates, which have been steady at 3.5%-3.75% since January 2026.

Markets are pricing in a 25-30% probability of a 25 basis point hike this week, but the consensus suggests that a rate adjustment is more likely to happen in September, with about 80% of market participants expecting a change by then.

The minutes from the June FOMC meeting revealed internal disagreement among committee members, with some pushing for hikes to combat inflation and others suggesting cuts. Despite this, the rate was held unanimously, but the debate highlights the complexity of the issue.

Revised 2026 inflation projections now average around 3.6%, well above the Fed's 2% target, which has been cited by Fed Chair Kevin Warsh as a reason to keep rates elevated. However, he stopped short of telegraphing any specific move for July.