Danske Research previews the October FOMC decision on Wednesday.

"We expect the Federal Reserve to keep policy rates unchanged at the October meeting, in line with consensus. Markets price in a 15-25% probability of a hike.  Most central FOMC members have signalled they can wait until December before hiking again, though a few see more urgency. We expect 2-3 votes for a hike," Danske notes.

"We expect the FOMC to hike rates gradually, with 25bp in December 2026 and March 2027, and risks skewed towards more hikes.

EUR/USD could tick modestly higher, and UST curve could steepen on Wednesday evening, but in 6-12M horizon, we forecast EUR/USD declining to 1.10," Danske adds.