The Federal Reserve's policy statement and updated economic forecast due out on Wednesday will be closely read in the wake of last week's volatile market action – the US stock market suffered its worst week in several years while crude oil tumbled to a five-year low. The US economy, however, continues to deliver encouraging news, based on last week's updates. Notably, the mid-December reading of the Reuters/University of Michigan's measure of consumer sentiment rose to its highest reading since January 2007. Meanwhile, retail sales posted a sharply higher-than-expected increase in November. We also learned from the US Labor Department that job openings inched higher in October, close to a 14-year high. The upbeat run of numbers is expected to continue this week with today's release on industrial production and tomorrow's report on housing starts. No wonder that analysts continue to project that the Fed will start raising interest rates next year, perhaps midway in 2015, as many economists predict.

Deciding if a mid-2015 rate hike is still reasonable will depend on what we see with the incoming macro data in the weeks and months ahead, but for now the numbers imply that the Fed is still on track to start tightening in the new year. Support for that outlook will get a boost if Wednesday's policy statement drops the “considerable time” reference that's prevailed in the recent past – a phrase that's signaled that the near-zero policy rate will roll on for, well, a considerable time. But that may be set to change. As Reuters reports:

Client notes from Goldman Sachs, Citi and Bank of America/Merrill Lynch this week deal with expectations for the removal of the wording, roughly agreeing that however close the call is, it is more likely than not that the phrase will go away.

“They are going to remove it; I don't think (Fed Chair Janet Yellen) is going to keep it in there just because of what we are seeing with the energy sector,” said Sean McCarthy, regional chief investment officer for Wells Fargo Private Bank in Scottsdale, Arizona.

“All the other data has been strong, whether you are looking at construction, at the ISM numbers, and especially the jobs data that she cares about most.”