The Wait Is Almost Over

After a two-day meeting the Federal Open Market Committee conducted in Washington everyone are waiting with bated breath for the release of their policy statement. Both economists and traders are expecting the first interest rate increase since 2006 marking the beginning of the end for the unprecedented era of easy monetary policy. The move would come at a time when a commodity slump is causing the market for high-yield bonds to gyrate, sending tremors through financial conditions indexes and spreading unease across trading desks.

While junk bonds linger as a concern, economic conditions finally point to a much-anticipated liftoff in rates: Recent data show that momentum is holding up, with consistent hiring, solid consumer spending and a modest pace of output growth. Inflation remains below the Federal Reserve’s 2 percent goal, but as officials from China to the euro area try to stoke domestic demand, international risks loom less ominously in the outlook.

There is ascheduled press conference 30 minutes after the committee’s decision isreleased, during which Fed Chair Janet Yellen can clarify why liftoff from zerois finally warranted -- or, in the case of a surprise hold, why it isn’t.She’ll also be able to lay out a map for future interest rate increases, the next focal point for market participants and economists.