Mid-September Shakeup: Three Catalysts, One Afternoon

Markets are pricing in a 93% probability of a 25 basis point rate hike by the Federal Reserve on Wednesday, marking the first increase since July 2023. The decision comes as inflation remains stubbornly above the Fed's 2% target. An unprecedented scenario could unfold if Chair Kevin Warsh opposes the hike while the committee votes to proceed—the first time in Fed history the FOMC would outvote a sitting chair. Key economic data on retail sales, housing starts, and building permits will provide context for the decision.