there should be no drama with next week's rate decision where a step down to a 50 bp hike to 4.375 is widely expected. Hence the focus will be on Chair Powell's press conference, SEP forecasts, and especially the dots. Analysts expect Powell will continue to stress the overriding risks of not bringing inflation under control, underscoring the likelihood of further hikes in 2023. Additionally, attention will be on the Fed funds forecasts for clues on the policy path. The Chair already warned to expect upward revisions to the September forecast, and analysts expect at least Bullard will mark-up his dot to a 5% level. But analysts still expect median Fed funds rates of 4.6% in 2023 and 3.9% in 2024. Analysts also expect small upward revisions for GDP growth and the PCE chain price gains in 2022, but downward bumps in the jobless rate estimates, which will likely be followed by small trimmings for the 2023 estimates for those variables. GDP is expected to be revised up by 0.1%-0.2% for all of the 2022 range and central tendency estimates. Headline and core chain price indexes should see 2022 increases of about 0.2%-0.3% for all but the high-end estimates.
