By John Byczkowski
The Cincinnati Enquirer

Everyone wants to hear the Federal Reserve say when.

With interest rates near 46-year lows, it is inevitable that the Fed will act to raise interest rates. Its governors meet today in Washington, and economists and investors eagerly await this afternoon's post-meeting statement for signs that a rate increase will come soon.

"The markets ... want the Fed to act," said Jim Russell, director of core equity strategy for Fifth Third Asset Management in Cincinnati. He said the stock market has been drifting sideways because investors are waiting for the increases.

The Fed won't change interest rates today because "they do not want to overreact to one month's data," said Lynn Reaser, chief economist for Banc of America Capital Management in St. Louis.

But she believes the Fed should raise rates soon. "A move sooner rather than later would prevent rates from moving sharply higher next year," she said.

This is what economists and investors will watch for today:

• The end of deflation concerns: Since last May, the Fed has said it's concerned that the economy is so weak, prices could spiral downward. Recent increases in the prices of gasoline, food and commodities may stop this talk.

• The end of patience: Since January, the Fed has said it "believes that it can be patient" in changing interest rates, because of the lack of economic growth. With hiring and inflation picking up, the Fed may drop this language.

• The end of balance: The Fed always asks what's more likely, recession or inflation? The Fed has said the risks are "balanced" - when one isn't more likely than the other - since November 2002.

The Fed today might say its bias is toward fighting inflation, possibly signaling higher rates soon.

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E-mail johnb@enquirer.com