Fed may find itself in a bind as it sets stage for Powell's successor

The US Federal Reserve's meeting this week will begin to set expectations for President Donald Trump's upcoming nominee to lead the central bank, potentially leaving policymakers in a bind between inflation concerns shared broadly and Trump’s demands for interest rate cuts.

- HOWARD SCHNEIDER

A quarter-percentage-point rate cut seems a given at the two-day meeting that ends on Wednesday, but language around that decision and accompanying economic projections will show whether the next chair will take over a body primed against further cuts or more open to argument and with a more dovish near-term outlook.

Trump wants lower borrowing costs in particular to boost the housing sector as a way to address broader concerns about affordability that could be central to midterm elections.

But delivering on that could pose risks for the next Fed chair, with forecasters expecting resilient growth next year, sustained consumer spending from enhanced tax refunds and, as a result, more persistent inflation.

Regardless of who leads the Fed, in the first order monetary policy is determined by economic conditions,