Wall Street Journal Fedwatcher Nick Timiraos is out with his latest Fed preview and it doesn’t include any kind of leak about a potential cut. Instead, he highlights that the Fed will set the table for a September cut without pre-committing. That’s a consensus view given that Sept is fully priced in, including a small chance of a 50 bps cut.

“The Fed’s newfound readiness to cut rates reflects three factors: better news on inflation, signs that labor markets are cooling and a changing calculus of the dueling risks of allowing inflation to remain too high and of causing unnecessary economic weakness,” he writes.

Fed officials unlikely to change rates at July meeting, but could signal potential September cut
“Officials have grown more wary of waiting too long and blowing a soft landing”
Inflation progress and cooling labor market shifting Fed’s risk calculus
Core inflation down to 2.6% in June from 4.3% a year ago
Unemployment rate up to 4.1% in June from 3.7% at end of last year
NY Fed’s Williams: “There is a decision ahead of us at some point” on lowering rates
Fed’s Waller: Labor market in “sweet spot,” needs to be maintained
Chicago Fed’s Goolsbee hints at argument for cuts: “We have tightened a lot since we’ve been holding at this rate”
SF Fed’s Daly cautions: “We’re not at price stability yet”

I wouldn’t expect any strong hints of action in the statement but even incremental signals will be seen as validation, given that the Fed knows what’s priced into the market. In contrast, the Fed could look to push back at the 100% pricing for Sept to given themselves some optionality, especially in light of Friday’s strong GDP report.