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The central bank's Federal Open Market Committee (FOMC) will meet over two days and announce its decision at 2:00 pm local time (18:00 GMT) on Wednesday. The Fed has missed its long-term 2% inflation target for more than five years, and at its last meeting in September, the FOMC voted to raise the key federal funds rate for the first time in three years, lifting the target range to 3.75% to 4%. The Fed's meeting comes days ahead of the key US midterm elections on November 3, with Democratic Party seeking to wrest control of both houses of Congress from US President Donald Trump's Republicans. Read more: Sinking profits turn China’s $3.5 trillion rout into trap Trump frequently berated and criticised Fed Chair Kevin Warsh's predecessor, Jerome Powell, over interest rates - which he deems to be too high - but has so far refrained from targeting the man he appointed to replace him on the issue. The Fed's preferred gauge for inflation, the Personal Consumption Expenditures (PCE) price index, hit a pandemic-era peak of 7.2% in 2022, before a series of interest-rate hikes tamed it to around 2.2% by late 2024. Trump's economic policies - including his upending of the global trade order using tariffs and his war on Iran - fuelled it once more, and it hit a three-year high of 3.9 % in May. Read more: Global Market Today: Asian shares slip as AI jitters deepen ahead of big tech earnings Since the United States and Israel attacked Iran in late February, global energy prices have skyrocketed, with Tehran's retaliatory actions sharply curtailing oil and gas supplies through the Gulf. Higher energy prices have begun to cascade into other goods and services, fuelling inflation in the United States, with prices a key issue for voters as they head to the polls. 'Based on the economics' Loretta Mester, former regional head of the Cleveland Fed, told AFP that the meeting's timing, just days ahead of election, would not be a factor for policymakers."The Fed doesn't take into account any kind of political issues in that FOMC room," she said. "It really is based on the economics." Mester argued that the fundamentals call for continuing to raise the interest rates. "The data that's come in continue to show a stable labour market and continue to show inflation above target," she said, adding that there was no evidence that inflation was on a path towards the target."The economics would suggest then you need to continue raising rates." Still, she thought most policymakers seemed keen to avoid moving too quickly and may hold rates at this meeting, waiting to tighten the screws at the following meeting in early December. (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
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