Learning how to make a big deal out of every Fed day is a requirement for passing the market commentary test.  But the often-overlooked extra credit can be earned in an elective: "How to be smugly dismissive about the potential impact of a Fed day."  Today's approach is probably between the two.  Smug dismissiveness would get the nod were it not for an updated dot plot--something the market always finds a way to react to.  It is also possible that Powell has something interesting to say in the press conference, although not incredibly likely.  

The market has taken the opportunity during the summertime months to price out the concerns associated with the bank failures earlier in the year and price in "higher for longer."  Case in point, markets have seen today's meeting in the 5.25-5.5% Fed Funds Rate range since June.  At the same time, there was more than 100bps of rate cuts priced in over the following 12 month.  Notice the closing of the gap between the highest and lowest lines since June in the following chart:

Long story short, traders are reasonably confident the Fed is at the ceiling, but they're leaving the door open for one more hike if the data remains overly resilient.  Either way, the majority of the Fed's policy transmission has been and will continue to be in just how long "longer" means.

Those thoughts can be communicated in two key places today: the press conference and the dot plot.  Of the two, the dots will be the most interesting considering we've had several decent CPI/PCE readings since the last update in June offset by persistently good labor market data and a 20 dollar per barrel surge in oil prices.  Those offsetting factors will likely lead to a shift in the dots resembling the following chart.  The higher and flatter the actual green line ends up being, the worse it will be for bonds today.  And if, by some weird miracle, the green line doesn't rise above the red line, the market will conclude the Fed is concerned about something, thus leading to a big bond rally (not likely... just laying out the other side of the spectrum).