Most Wall Street investors and Washington Fed watchers now expect the Fed to raise rates at this week's meeting, but a minority of economists warn a hike could be a serious policy error. Moody's Analytics chief economist Mark Zandi said the probability of a major Fed policy mistake is worryingly high and rising, arguing it is difficult to slow growth without layoffs, higher unemployment or a self-reinforcing negative cycle. Steve Englander, head of G10 FX research at Standard Chartered, called a

Most Wall Street investors and Washington Fed watchers now expect the Fed to raise rates at this week's meeting, but a minority of economists warn a hike could be a serious policy error. Moody's Analytics chief economist Mark Zandi said the probability of a major Fed policy mistake is worryingly high and rising, arguing it is difficult to slow growth without layoffs, higher unemployment or a self-reinforcing negative cycle. Steve Englander, head of G10 FX research at Standard Chartered, called a hike premature given contradictory signals in inf data and said the Fed should stand pat until those signals weaken; a hike followed by a reversal to cuts within months would signal very unstable decision-making. Michael Pearce, chief US economist at Oxford Economics, said near-term odds of a hike have risen but the September decision remains finely balanced; he still expects the Fed to hold rates unchanged.