Five Things World Business Will be Talking About Today

(Bloomberg) 

It’s Fed day, no deal on bipartisan Obamacare fix, and pound rallies on strong retail sales. Here are some of the things people in markets are talking about today.

Decision day

At 2 p.m. Eastern Time the Federal Reserve will publish its latest monetary-policy decision. While markets are expecting no change to rates, investors will be looking for details on how the central bank intends to start shrinking its $4.5 trillion balance sheet as well as the so-called dot plot, which indicates the path ahead for interest-rate increases. The announcement will be followed 30 minutes later by a press conference with Chair Janet Yellen. Market futures show a rate hike by the end of the year is seen as a coin-flip by investors.

No bipartisan health deal

Efforts to advance a small package of measures to repair Obamacare have failed to secure enough support to proceed, according to Tennessee Republican Senator Lamar Alexander.  The GOP continues to struggle for the votes needed to pass a wider package of ‘repeal and replace’ measures while time is running out for a resolution. Senator John McCain is still withholding his support on the latest plan, which is opposed by doctors and hospitals.

Retail sales jump

The British pound rallied after U.K. retail sales rose at the fastest pace in four months in August at 1.0 percent, well ahead of the expected 0.2 percent increase. The data will increase speculation that the Bank of England may raise rates in the coming months. Officials at the bank gather this week for their quarterly financial stability meeting, with the rapid increase in consumer debt – currently rising five-times faster than incomes – likely to be among the main topics for discussion.

Markets waiting

Equity markets across the world remain quiet ahead of the Fed’s decision. Overnight, the MSCI Asia Pacific Index rose 0.2 percent, while Japan’s Topix index was little changed. In Europe, the Stoxx 600 Index was unchanged at 5:40 a.m., and S&P 500 futures were also holding steady. The 10-year Treasury yield was at 2.225 percent and gold was up $9 an ounce.

Natural disasters

Hurricane Maria is expected to hit Puerto Rico today after battering the storm-ravaged Caribbean island nation of Dominica overnight. The storm is forecast to be a Category 5 hurricane when it makes landfall. Mexico City was struck by a 7.2 magnitude earthquake yesterday, leaving at least 248 dead on the 32nd anniversary of the 1985 quake that killed more than 5,000.