Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020.
Unexpectedly hot August inflation data last week also raised bets on increased rate hikes down the road, with the terminal rate for U.S. fed funds now at 4.47%.
The Fed regards a recession as regrettable, but necessary to fight inflation," Grisanti said.
The CBOE volatility index (.VIX), also known as Wall Street's fear gauge, rose to 27.72 points, inching closer to a more than two-month high.
Focus will also be on new economic projections, due to be published alongside the policy statement at 2 p.m.