Good day. Jerome Powell could shed light on the Fed's thinking about how to provide more support to the economy after the rate-setting Federal Open Market Committee wraps up its two-day policy meeting today. Nick Timiraos takes a look at what to watch for. The Fed said yesterday it extended its emergency lending programs by three months. Meanwhile, Joe Biden said he wants to change the Federal Reserve Act to add targeting racial gaps in jobs, wages and wealth to the central bank's mandate. And Michael S. Derby takes a look at how the Fed has already moved in that direction.

 Now on to today’s news and analysis.

Federal Reserve officials are likely to continue their debate Wednesday about how to provide more support to the economy now that interest rates are pinned near zero, but are unlikely to announce major policy changes. Then, Fed Chairman Jerome Powell follows with a news conference starting at 2:30 p.m., at which he could explain how he and his colleagues are thinking about possible additional steps. Here’s a look at what to watch.

When Donald Trump ran for president in 2016, he treated the Federal Reserve as an adversary. In a plan released by his 2020 challenger Joe Biden on Tuesday, the presumptive Democratic presidential nominee seeks to spur the central bank down a road it’s already on. Read more.

• Virus Stimulus: How Republican and Democratic Plans Compare
• Is Extra Unemployment Aid Deterring People From Seeking Work?

8:30 a.m.: U.S. Commerce Department releases June advance economic indicators report
2 p.m.: U.S. Federal Reserve releases policy statement
2:30 p.m.: Fed’s Powell holds press conference

8:30 a.m.: U.S. Commerce Department releases first estimate of second-quarter GDP and annual update

On a day when the Federal Reserve announced some of its key emergency lending facilities will keep going until the end of the year, new data points to trouble for the U.S. economy. The Dallas Fed said in its latest service sector report for July that "labor market indicators suggest further cuts in jobs and employee hours, while firms’ outlooks once again turned pessimistic," amid a massive retreat in retail activity as the coronavirus pandemic accelerated in Texas. Additionally, The Conference Board said that in July consumers grew less optimistic about the short-term outlook for the economy and labor market and remained subdued about their financial prospects. “Such uncertainty about the short-term future does not bode well for the recovery, nor for consumer spending,” The Conference Board said. The New York Fed also weighed in and said the likely path of economic activity in the U.S. this year is getting worse. Its latest update of its real-time growth tracker, the Weekly Economic Index, predicts a decline in GDP of 7.24% for the year, compared with a decline of 6.65% forecast last week. The index had been predicting a steady trend of improvement for some time after bottoming out at a forecast decline of 11.48% on April 25. The New York Fed index is more evidence that whatever recovery the economy had been seeing is stalling amid surging cases of coronavirus illness coupled with a foundering national government response.

                                                                                           —Michael S. Derby

• U.S. home-price growth slowed slightly in May, with the S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas, rising at a 4.5% annual rate, compared with a 4.6% rate in the prior month.
• U.S. consumer confidence slipped in July as a spike in coronavirus cases prompted renewed restrictions across the country, lowering The Conference Board’s consumer confidence index to 92.6 from an upwardly revised 98.3 in June. (Dow Jones Newswires)
• Europe’s banks are starting to reveal the extent of the pandemic’s impact on their businesses.
• Some European governments are warning that a recent surge in coronavirus infections could burgeon into a second wave, as the summer tourism season peaks and people express fatigue with measures that had successfully brought the spread under control in Europe.
• Debt financing for acquisitions and leveraged buyouts by high-yield European companies jumped to over €6.4 billion ($7.5 billion) in the past four weeks, ending a nearly five-month lull in the market, according to Dealogic
• Malaysia recorded its largest-ever monthly trade surplus in June as exports to China and the U.S. rebounded, lifting the surplus 98.7% from a year earlier to 20.89 billion ringgit ($4.91 billion), the Ministry of International Trade and Industry said. (DJN)

This newsletter is compiled by James Christie in San Francisco and Ed Ballard in London. 

Send us your tips, suggestions and feedback. Write to:

Jon Hilsenrath, Michael Derby, Nell Henderson, Nick Timiraos, Jason Douglas, Paul Hannon, Harriet Torry, Kate Davidson, David Harrison, Kim Mackrael, Tom Fairless, Megumi Fujikawa, Michael Maloney, Paul Kiernan, James Glynn

Follow us on Twitter:

@WSJCentralBanks, @NHendersonWSJ, @michaelsderby, @NickTimiraos, @PaulHannon29, @wsj_douglasj, @HarrietTorry, @KateDavidson, @d_harrison, @kimmackrael, @TomFairless, @megumifujikawa, @mikemaloneyny, @pkwsj, @JamesGlynnWSJ