Morgan Stanley Research discusses its expectations for next week's FOMC policy meeting.

"For the FOMC policy statement: Regarding current conditions, we expect the FOMC statement to acknowledge steady growth in economic activity (in line with the spirit of the Beige Book, which described activity as "little changed"). Elsewhere we expect little change in current conditions, e.g. inflation remains elevated, and job gains continue to be robust. The statement will continue to acknowledge the uncertain effects from tighter credit conditions, and stress stability in the banking system," MS notes.

"Regarding forward guidance, we expect the Committee to convey that the federal funds rate is likely to "remain above levels that are expected to prevail in the longer run for a substantial amount of time"," MS adds.