Federal Reserve watchers were largely right. The Federal Open Market Committee again raised the benchmark federal funds rate a quarter point in its July meeting. More important were the clear indications, both in the formal discussion delivered by Fed Chair Jerome Powell and in his answers to questions, that chances remain high, though not absolute, of another rate hike in September.

That leaves the biggest question: Given the inflation slowdown in June, what will it take for them to stop the hikes and what will the new normal look like?

In the formal statement, Powell pointed to indicators suggesting that "economic activity has been expanding at a moderate pace." Slowing to some degree have been consumer spending, activity in the housing sector after higher mortgage rates, and business fixed investment, again due to higher rates.