Markets Braced as Fed Faces Key Rate Decision

U.S. stock index futures climbed as markets anticipated the Federal Reserve's year-end rate decision, expecting a trim of 25 basis points. All eyes are on the Fed's detailed rate projections and Chair Powell's remarks for insights into 2025's monetary policy direction amid persistent inflation.

On Wednesday, U.S. stock index futures inched higher as market participants braced for the Federal Reserve's final rate decision of the year. With a 25 basis point cut largely predicted, investors are keenly awaiting the Fed's economic projections and Chair Jerome Powell's remarks for hints on rate policy in 2025.

Analysts from ING have suggested that the prospect of fiscal stimulus under President-elect Donald Trump may lead to adjustments in the Fed's dot plot projections, although a rate cut is still expected. This development comes as main Wall Street indexes had seen declines, influenced by inflation and growth factors that may prompt a hawkish stance from the Fed in the future.

Meanwhile, major rate-sensitive stocks experienced gains in premarket trading, with Nvidia recovering after recent lows, though Tesla saw a drop. Despite uncertainties over Fed policy, stock indices remain poised to finish the year strong, led by technology sector momentum and hopeful economic policies.

(With inputs from agencies.)