The recent rally in the stock market might be captured (in the numbers).
Unless the Bush administration can successfully counter recent criticism, Bush and consumer confidence might continue to flounder. If so, the markets will justifiably worry about Bush's chances of re-election.
Given that some of the news of late ... has been on the weak side, and given that the Fed's own Beige Book report reflected weakness, they might show an inclination to cutting rates in the future,
This time, they want to keep rates low to fight deflation -- a demon that may have vanished already. They might be successful again, but something else might build up, some other unintended consequence, including some inflation.
The Fed doesn't want sudden market reactions in response to news that might be difficult; they want to cause as little volatility as possible, ... Greenspan has admitted to sending signals in the past -- it's the way they operate.
There were rumors that the Fed might cut rates today, but of course they did nothing.
Looking out even further toward the end of the year, investors might grow optimistic about the end-of-year economic situation, as 2004's strong job growth could be seen as raising the prospects for holiday spending, hence giving the economy momentum as it enters 2005,