The Fed is expected to announce another 10 billion monthly reduction of its asset purchases with the Fed’s quantitative easing program that is well on its way to completion by the fall of 2014.
Investors are paying closer attention to any potential changes in the Fed’s plans to raise short term interest rates in 2015 which may come sooner than expected following yesterday’s released inflation numbers for May that showed inflation rising more than was forecasted and could give the Fed more breathing room to justify raising short term interest rates that remain at historic lows.
The consumer price index jumped in May to 0.4 percent, beating the forecast of 0.2 percent, according to briefing.com, and rising the highest since February 2013.
Core CPI, an inflation reading that excludes food and energy, went up 0.3 percent in May, marking the largest increase since August 2011.
The all item index increased 2.1 percent over the past year, marking the largest 12 month increase since October 2012.