The Federal Reserve makes its decision today. And on Fed day, will the team led by Yellen and co. acknowledge the improvement in both markets and the economy.

Here are quick previews from Deutsche Bank, Citi and BNP Paribas:

Here is their view, courtesy of eFXnews:

USD Into FOMC: ‘The Ducks Have Aligned’ – Deutsche Bank

The Fed could not have wished for more sanguine financial markets, or a more benign international events calendar and data backdrop. It begs the question: in a volatile world will ‘the ducks’ ever align so perfectly for a tightening, and will the Fed miss their opportunity?

The ducks have aligned:

Compare key financial condition indicators to when the Fed tightened in December: the S&P is ~6% higher and nudging all-time highs; the 2y and 10y yields are 26bps and 66bps lower respectively; the Broad TWI dollar is slightly softer; high yield bond prices are substantially stronger and related commodity prices are healthier.

Compare event risks: Rmb day to day variation/depreciation is being readily absorbed; Brexit has passed, and related contagion fears for the US are proving greatly exaggerated.

Compare the numbers: For November 2015 prior to the December 2015 FOMC rate hike, the ISM manufacturing is up close to 5pts; 3m avg of retail sales ex autos is up from zero to over 8% annualized; 3m avg of NFP has decelerated from 241K to 147K as might be expected at this point in the cycle; and the U3 unemployment and U6 ‘underemployment’ rates are down 0.1% and 0.3% respectively.

USD Into FOMC: A Quant Insight – Citi

With the meteoric rise of the US Economic Surprise Index driven by improvement in surprises across sectors, we may see a shift in policy tone from the Fed which advised caution on over-reacting to isolated data surprises last month.

We investigate deeper into the sources of improvement in the ESI and find that in addition to positive surprises, data momentum is also picking up, making it more difficult for the Fed to continue emphasizing growth fears.

We find that the aggregation in the US raw data surprises has been a good historical indicator for hawkish Fed bias and performs well in trading EURUSD around Fed announcements.

With hedge fund positioning suggesting a long USD bias and the US ESI at 2-year highs, we are likely to see a USD bid into the next Fed meeting.

July FOMC: A Mockup For The FOMC Statement With Expected Changes – BNPP

While we expect an unchanged fed funds rate (0.25-0.50%), the policy statement is likely to sound more upbeat than in June. (see our mock version at the end of this note). The bulk of the changes should come in the first paragraph describing current economic conditions. Instead of saying “growth in economic activity appears to be picking up”, we think the Committee will just say that it “has picked up”.

Given June’s monster 287k gain in payrolls, the FOMC will likely upgrade its description of the labor market, while acknowledging that the trend in employment growth has slowed somewhat since the beginning of last year. In its previous statement, the Committee said that job gains had diminished.

We expect minimal changes to the language on inflation expectations. – Market-based measures of inflation compensation will likely be described as remaining low, not in decline.

We expect inflation to remain on the list of things it is monitoring, as well as financial and global economic developments. – While not part of our central scenario, it is possible that the Committee drops the word “most” from its previous assessment that “most survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.” The reason is that the University of Michigan measure of long-term inflation expectations has rebounded since the June FOMC meeting and is no longer an outlier.