CNBC Daily Open: Nearly everything slows down the day before the Fed meeting

If it feels like we have lived through a filler episode before the big season finale, well, that's because it's fairly accurate.

Investors are anticipating the conclusion of the U.S. Federal Reserve's meeting Wednesday, when they get to hear its interest rate decision and Chair Jerome Powell's (arguably more important) press conference.

Markets were hence in an awkward limbo Tuesday. U.S. stocks declined, but only mildly. The S&P 500 dipped 0.13% — but still closed above the 6,600 level it broke Monday — and even hit a fresh intraday record earlier in the session.

In other words, investors didn't seem to want to make any big moves before the Fed's meeting ends.

Even news that broke yesterday — while unrelated to the central bank and interest rates — were focused on casting an eye to the future rather than immediate developments. Further U.S.-China trade talks will happen before November, while a TikTok 'framework' deal to allow it to continue operating in the U.S. is expected to be finalized.

All of that contributed to the feeling of watching the credits roll just as a cliffhanger occurred.

(Spoiler alert: There'll almost definitely be a 25 basis points rate cut — an extra-large 50 point slash is unlikely, unless the "outies" of some Fed officials overpower their independent "innies.")

Fed set to cut rates, but forecast for rest of 2025 is key to markets with politics clouding the picture

The Federal Reserve meets this week with some big items on the agenda: An important rate decision and forecast of what's ahead, combined with a healthy dose of political intrigue uncommon for central bank policymakers.

On the monetary side, the Federal Open Market Committee on Wednesday will release its ruling on where it will set the overnight borrowing rate. Politically, there will be one new Fed governor, President Donald Trump's appointee Stephen Miran, who almost certainly will dissent from the widely expected decision to lower the federal funds rate by a quarter percentage point, opting for an even bigger cut.

— Jeff Cox