Stock futures are falling as traders await the latest rate hike decision from the Federal Reserve

Stock futures fell on Tuesday evening as investors looked forward to the Federal Reserve’s meeting on Wednesday.

Futures related to the Dow Jones Industrial Average fell 48 points, or 0.14%. S&P 500 and Nasdaq Composite futures fell 0.20% and 0.37%, respectively.

These moves come after stocks jumped strongly until the end of January. The Dow Jones Industrial Average ended the day up nearly 369 points, up 1.09%. The S&P 500 rose 1.46% to its best January performance since 2019. The heavyweight Nasdaq Composite rose 1.67%, its best January performance in 22 years.

On Wednesday, the Federal Reserve will announce how much it will raise interest rates in its latest efforts to tame soaring inflation. Markets expect a rise of 25 basis points, or 0.25 percentage point, from the central bank. On Tuesday, the labor cost index, a measure of wage increases, showed compensation rising 1% in the fourth quarter, less than the 1.1% estimate by the Dow Jones.

However, traders may come forward in anticipation of a more dovish tone from the Fed, or look for signs that there is a pause in the rally or even a pivot point soon.

“The aggressive tightening in 2022 has led to signs of inflation slowing but from levels that remain unacceptably high,” Ron Temple, senior market analyst at Lazard, said in a note on Tuesday. “With markets discounting up 25 basis points per second, Powell’s job is to signal unequivocally the Fed’s commitment to taming inflation.”

The Federal Reserve will announce its decision Wednesday afternoon, followed by remarks by Chairman Jerome Powell.

Earnings season continues, too. Peloton and Meta Platforms are scheduled to report quarterly results on Wednesday.