NEW YORK: Wall Street stocks advanced early Wednesday ahead of a Federal Reserve announcement on interest rates, which is also set to offer clues on future monetary policy.

The market is betting heavily that the US central bank will hold steady on rates, but the focus will be on whether Fed Chair Jerome Powell signals a high chance of another rate hike this year.

Traders are also watching for the central bank’s 2024 monetary policy outlook, and if it continues to imply interest rate cuts next year.

US Fed likely to pause rate hikes and raise growth forecast

About 25 minutes into trading, the Dow Jones Industrial Average was up 0.4 percent at 34,660.68.

The broad-based S&P 500 gained 0.3 percent to 4,458.71, while the tech-rich Nasdaq Composite Index jumped 0.3 percent to 13,719.06.

“Keen attention will be paid to the median forecast for the 2024 federal funds rate,” said Briefing.com analyst Patrick O’Hare.

“Participants are going to be anxious to see if the Fed dials back its own rate-cut projections,” he added.

The US cental bank announcement comes a day before one due from the Bank of England.

On Wednesday, data showed British inflation unexpectedly slowed in August.

The Consumer Prices Index dropped slightly to 6.7 percent from 6.8 percent in July, bringing inflation to the lowest level since February 2022.