Investors are heading into this week's Federal Reserve meeting increasingly prepared for a potential interest rate hike, a move that could put further pressure on a U.S. stock market rally already facing headwinds from rising Treasury yields.
The Fed has kept interest rates unchanged in 2026, but persistent inflation above its 2% annual target has strengthened expectations that policymakers could resume tightening. Rate increases are the central bank's traditional tool for curbing inflation by cooling demand.
