STANCHART strategists continue to project that the U.S. Federal Reserve will leave interest rates unchanged at this week's policy meeting.

In a Monday report, strategists John Davies and Steven Englander noted that, in their view, the Fed's appropriate course of action is clear: hold rates steady until the noise from tariffs and data revisions subsides.

While maintaining the current rate may be justified, they acknowledge that there is a clear risk associated with holding steady, which could impact the long end of the U.S. Treasury yield curve and the U.S. dollar.