The Federal Reserve releases its next policy statement on Wednesday. And with nervousness about the future of the federal funds rate mounting, investors will certainly be watching intently.
"The marketplace is going to dissect all the nuances and read very closely between the lines to look for further evidence as to how the Fed is going to implement a 'qualitative guidance' policy path," David Robin of Newedge wrote to CNBC.com.
In its March statement, the Fed moved from quantitative to qualitative guidance on the federal funds rate—the important rate at which banks lend to each other. At her post-statement press conference, Fed Chair Janet Yellen caused substantial nervousness when she said that the target on the rate could be raised six months after quantitative easing ends. Yet in later statements, she seemed to walk that back.
"She confused the market, and then she smoothed that out [and] sedated the market," said Jeff Kilburg of KKM Financial. "So the language is going to be key."