Fed Uncertainty Reigns as Rate Hikes Loom

The Federal Reserve's June decision to leave its benchmark rate unchanged for the sixth consecutive meeting has created uncertainty about future interest rates. The Fed's dot plot report, released last month, shows that nine of the 19 policymakers predict at least one rate hike by year-end, with six supporting two hikes.

This nearly 50/50 split within the committee makes it unclear whether the Fed will hold or hike its rates in the remainder of the year. The annualized inflation rate dropped to 3.5% in June, but oil prices have risen back to around $100 a barrel due to the ongoing Iran war.

New Fed Chair Kevin Warsh has expressed 'no tolerance' for high inflation and vowed to bring it down toward the Fed's 2% target. This stance could support the case for a rate hike as early as this week, but it is far from a done deal.