The focus of the US markets will be squarely on the Fed and the results of the FOMC meeting on Wednesday

The focus of the US markets will be squarely on the Fed and the results of the FOMC meeting on Wednesday. In terms of actions, nothing is likely to change. Interest rates will remain at their current historically low levels, and tapering will continue at its steady pace. However, the language of the Fed statement could spark significant market action. On one hand, the BOE surprised everyone by suggesting higher rates will be needed sooner than expected. On the other hand, the conflict in Iraq and subsequent climb in the price of crude oil could put a damper on economic growth. In my opinion, the Fed is highly likely to maintain the same view of interest rates regardless of recent events. In other words, I don't expect even a hint of hawkish language from the Fed this time around.