The Federal Reserve’s policy committee meets again tomorrow and on Thursday. I strongly doubt the Fed will make any change in interest rates.

The Fed’s post-meeting statement, however, will be very interesting and investors all over the world will be quick to dissect it. What I want to see is if the Fed acknowledges that it’s winning the war on inflation. I still believe that once the Fed is comfortable that inflation is under control, it will move to lower interest rates. That could cause the market to soar.

There were two important stories I wanted to highlight from today. The first is that consumer confidence fell to 103.9 from 108.5. This was below the consensus estimate of 105. Consumer confidence is critical because consumers make up roughly 70% of the American economy.

The other news item, and it’s strongly related to the first, is that new home sales fell 1.6% to 915,000. Again, this was below estimates. There were also some downward revisions to the numbers from February, March and April. Basically, this means that the housing mess hasn’t reached bottom.

Here’s a good example: This morning, Lennar (LEN) reported a loss for last quarter of $244 million. Lennar used to be a market darling. In my Blue Chip Growth service, we made a hefty profit in Lennar during the early part of this decade. Fortunately, we sold out a long time ago. For now, we’re steering clear of this sector. Stuart Miller, Lennar’s CEO, said he continues “to see weak, and perhaps deteriorating, market conditions.”