Fed expected to raise rates today: 4 things to know

People walk past an electronic stock board showing Japan’s Nikkei 225 index at a securities firm in Tokyo Wednesday

People walk past an electronic stock board showing Japan’s Nikkei 225 index at a securities firm in Tokyo Wednesday

"The market is positioned for a "dovish hike" by the Fed so we think the balance of risk post the meeting is for upside to United States rates and the United States dollars", said Jason Wong, currency strategist at Bank of New Zealand, in a note.

"The truth is", he writes, "changes to short-term interest rates, like the Federal Funds rate, tend to have very little influence on mortgage rates".

"The main focus this week will be on the Fed's balance sheet policy", said Michelle Girard, chief USA economist at RBS.

Fed leaders end a two-day meeting in Washington and investors believe there's a 95% chance of a rate hike.

Following the May meeting, the Fed kept the benchmark rate at 0.75-1 percent per annum. It foresees one additional rate hike this year, unchanged from its previous forecast.

The policymakers now expect their favored measure of inflation to come in at 1.6 percent this year, down from the 1.9 percent they expected in March and below their 2 percent target.

US 30-year yields were last at 2.863 percent, compared to 2.868 percent late Monday. Newcrest Mining is adding 0.4 percent and Evolution Mining is rising more than 1 percent.

Jared Bernstein of the Center (Shanghai: 603098.SS - news) on Budget and Policy Priorities told AFP the Fed is likely to increase rates to ensure it will have room to maneuver and lower rates again in the event of a negative shock to the economy.

BREXIT: The European Union moved to tighten its oversight of a key financial market based in London, threatening tens of thousands of jobs in Britain once the country exits the bloc.

Asian stocks were mixed Wednesday following Wall Street's tech-driven rise as investors waited for word from the U.S. Federal Reserve on a possible interest rate hike.

The U.K.'s FTSE 100 Index edged down by 0.2 percent, while the French CAC 40 Index rose by 0.4 percent and the German DAX Index climbed by 0.6 percent.

The 225-issue Nikkei Stock Average shed 15.23 points, or 0.08 percent, from Tuesday to end the day at 19,883.52.

The US dollar fell as far as C$1.3209, its lowest since February 28, having shed two cents in as many days.

On Wall Street, stocks closed higher on Tuesday with the Dow and the S&P 500 both climbing to record closing highs on bargain hunting. "A more dovish surprise, however, could generally see equity markets rallying strongly and especially emerging markets and currencies doing so, which are a bit more sensitive, traditionally, to the Dollars direction (and as the global currency is the USD, a dovish Fed is positive for global liquidity)".

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