HERE COMES THE FED DECISION...

AP Photo/Susan Walsh

At 2 p.m. ET, the Federal Open Market Committee (FOMC) will make its monetary policy announcement. It will also update us on its forecasts for the economy and interest rates.

This will be followed by Federal Reserve chair Janet Yellen's press conference at 2:30.

The Fed is widely expected to lower its asset purchases to $15 billion in agency mortgage backed securities (MBS) and $20 billion in Treasuries. It is also expected to maintain its current forward guidance language on the federal funds rate.

We'll be watching for any changes to dot chart which shows the predicted path of the federal funds rate, where each dot represents where an FOMC member sees the federal funds rate at the end of each year.

Bank of America's Michael Hanson and Ethan Harris expect that Yellen will downplay the "dot plot" as not being a policy tool.

"Perception is realty," Scott Buchta at Brean Capital wrote ahead of the announcement.

"Will the markets interpret the Fed's statement as being more dovish or more hawkish? The Fed has clearly charted out a potential course of action in the form of an IF-THEN statement. IF unemployment falls and inflation rises, THEN we will raise interest rates. While previous market reactions have focused on the THEN side of the equation, as QE3 winds down we are quickly approaching the point where the markets will be paying much closer attention to the IF and WHEN components."

One question people are now asking is whether Yellen is going to go "Carney." This of course refers to Bank of England governor Mark Carney, who last week said rate hikes could come sooner than markets expect.

We'll have all the coverage LIVE at Business Insider.