Markets are pricing a 92.5% probability that the Federal Reserve will raise interest rates by 25 basis points at its Thursday FOMC decision, which is scheduled for 2:00 p.m. ET, followed 30 minutes later by a monetary-policy press conference by Fed Chair Kevin Warsh. The expected move would be the first increase since July 2023, taking the federal funds target range from 3.50%-3.75% to 3.75%-4.0%, based on earlier supplied estimates. Investors have shifted their focus from whether the Fed will act to how many additional increases policymakers may signal in their updated economic projections and dot plot. A limited sequence of one or two further hikes was viewed as manageable for U.S. equities and Treasury markets, while guidance pointing to repeated increases could push the 10-year Treasury yield sustainably above 5% and intensify volatility in stocks and dollar-denominated assets. Warsh also faces a communications challenge between Trump’s preference for low interest rates and elevated long-term Treasury yields.