The Fed's sound box before the meeting: The Middle East war may very likely reinforce the consensus expectation that the Fed will maintain interest rates unchanged.

Famous journalist Nick Timiraos, known as the "New Federal Reserve Press Agency," said that the recent Middle East war is likely to strengthen the consensus expectation that the Federal Reserve will maintain interest rates unchanged. The more difficult question is what signals officials will send about the direction of interest rates in the coming months. Timiraos believes that there are three key points to watch in this week's Federal Reserve decision: first is the policy statement. In January of this year, some officials attempted to remove wording from the statement implying that the next action would be a rate cut, but were unsuccessful. If this meeting makes this modification, it would signal the first clear acknowledgment that the easing cycle may have ended. The second is the quarterly forecasts, where 19 officials at the meeting will each write down their expectations for inflation and interest rate trends in the coming years. The third is the post-meeting press conference, where Federal Reserve Chairman Powell may amplify or downplay any signals released by the previous two points.