Markets Eye Upcoming Fed Meeting Amid Inflation and Geopolitical Risks

The Federal Open Market Committee (FOMC) is scheduled to meet on July 28-29, with markets closely watching for signals on interest rates. Policymakers face challenges from rising crude oil prices, driven by renewed Hormuz risk, which is contributing to a sharp weekly gain in oil. While earlier inflation data for the month was not as severe as some feared, energy spikes are complicating the narrative. Investors are expected to focus more on the language regarding inflation risks, energy, and financial conditions in the statement and press conference, rather than just the rate decision itself, especially if policy remains unchanged.