A rate hike by the FED is all but certain. The writing seems to be on the wall as the current 0.75% rate will not be enough to help the US keep up with the curve. The increase is expected at 0.25%, bringing the short-term borrowing rate to 1%. Yellen seems to have all the necessary data to back up the decision as the unemployment rate was clocked at 4.7%, a record low, as well as an inflation rate, creeping up close to 2% already. Some even say the rate might be too little too late as indicators, such as the housing prices, are nearing precrisis levels. An increased FED rate is seen as not only possible, but necessary to keep the increasing inflation in check. This is seen as only the first in a line of such hikes this year. If this one goes through, the likelihood of a total of 3, even 4 increases just this year, will be very big.
Just a day later, the central banks of the England (BOE) and the Japanese central bank (BOJ) will also hold a meeting regarding their own bank rates with changes less likely, however.
Adding more fuel to the already volatile Greenback, the US Bureau of Labor Statistics will also announce tomorrow data on the CPI, as well as on the Retail Sales indices. Neither of the four: CPI m/m, Core CPI m/m, Core Retail Sales m/m or Retail Sales m/m have any clear indication if they could outperform the previous month's data, but preliminary figures would suggest that this would not be the case.