Fed set to hold interest rates steady, but on track for more hikes

The calendar turns to August and another Federal Reserve rate decision.

The Fed begins a two-day policy meeting on Tuesday and is expected to keep interest rates unchanged on Wednesday.

Economic growth combined with rising inflation are likely to keep it on track for another two hikes this year, according to Reuters.

President Trump has started criticizing the Fed’s plan to raise rates.

The Fed has increased borrowing costs in March and June, and additional moves are expected in September and December.

Policymakers have raised rates seven times since December 2015.

There is no press conference scheduled this time. Fed watchers expected to see only minor changes in the policy statement.

The June statement emphasized accelerating economic growth, strong business investment and rising inflation.

The U.S. economy grew at its fastest pace in nearly four years in the second quarter as consumers boosted spending and farmers rushed shipments of soybeans to China to beat retaliatory trade tariffs, Commerce Department data showed on Friday.

The Fed's preferred measure of inflation increased at a 2.0 percent pace in the second quarter, the data also showed.

Economists expect data later on Tuesday to show prices in June were 2.0 percent higher than a year earlier, matching the gain in May.

That would mean two straight months that inflation has hit the Fed's 2 percent target rate after undershooting it for six years.

Unlike past Presidents, Trump has commented on Fed policy, saying he was worried growth would be hit by higher rates.

Administration officials played down the president's comments, saying he was not seeking to influence the Fed.

Meanwhile, when he was on the campaign trail, Trump criticized Powell's predecessor as Fed chair, Janet Yellen, for keeping interest rates too low.