Fed is ready to raise rates again. And then what?

The Federal Reserve is preparing to raise its benchmark interest rate for the 10th time on Wednesday, the latest step in its yearlong effort to curb inflation at the fastest rate of rise in four decades.

However, economists and Wall Street traders will be more interested in what the fed and its owner Jerome Powell mention in a statement and at a press conference about a bigger question: What’s next? And in that sense, they may be disappointed.

Economists say Powell is likely to hint that the Fed is nearing an expected pause in its rate hikes. However, that does not necessarily mean that it will send a clear signal that this week’s increase will be the last one imposed by the fed.

Instead, he is likely to warn that more rate hikes could follow if inflation remains stubbornly high, well above the Federal Reserve’s 2% target rate.

“He wants to tell the market, ‘Don’t relax. Don’t be complacent. We could still go higher if we think we need to, but we don’t know yet if we have to.’“, said Derek Tangeconomist of L.H.Meyeran economic consulting firm.

The collapse of the First Republic Bank over the weekend, the second largest bank failure on record, is not expected to stop the Fed from proceeding with a rate hike on Wednesday.

First Republicthe third major bank to fail in the past two months, was seized by regulators late Sunday and sold to JPMorgan Chase.

Even if Powell suggests the Fed will stop raising after this week, he said Tangyou will probably emphasize that the fed it does not expect to cut rates this year. Still, investors are predicting two Fed rate cuts by the end of the year, according to the CME stock trader’s Fedwatch tool.