WASHINGTON -- The Federal Reserve is having trouble delivering a new message about how far it expects to raise interest rates: It isn't sure.

Financial markets, having grown accustomed to the Fed telling them where rates are headed, seem unwilling to hear that new message. After nearly two years of raising rates, the Fed's efforts to convey that it isn't certain where they are headed now have been read by markets, instead, as a forecast of where it will take rates. Changing interpretations of that forecast have been roiling the markets in recent days.

A potentially bigger problem for new Fed Chairman Ben Bernanke is that, with the latest growth data robust and inflation ticking higher, markets also seem to fear that the Fed will stop raising rates too soon. Since Mr. Bernanke talked last week on Capitol Hill about the possibility of a pause in the Fed's rate increases, bond and commodity markets have signaled increased concern about inflation.

The Fed is expected to raise its target for the federal-funds rate, charged on overnight loans between banks, by a quarter of a percentage point to 5 percent next Wednesday. It would be the 16th consecutive such increase. The Fed also is likely to signal continuing concern about inflation in its end-of-meeting statement.

A bigger issue is what to say about its intentions regarding future rate actions -- specifically, whether to drop a sentence included in previous statements that says further rate increases "may be needed."

Dropping the sentence would fit officials' recent strategy of scaling back guidance to the markets. "The forward-looking guidance on policy has lived its useful life," said Peter Hooper, chief U.S. economist at Deutsche Bank. But dropping the sentence risks being read by markets not as a tactical step, but as a sign of reduced Fed concern about inflation.

The wording issue encapsulates Mr. Bernanke's problem. He came to the Fed promising to make its policy making more transparent, but arrived at the very moment when economic circumstances make it less clear what policy will be.

Fed officials always have an expectation of where rates will go, at least privately. But their confidence that their expectation will be met, and willingness to talk about it in public, varies over time. Back in August 2003, they were confident the funds rate could stay at 1 percent for a "considerable period," and said so. That was a strategy that Mr. Bernanke, then a Fed board member, strongly backed as part of an effort to avoid the sort of deflation that was ravaging Japan.

By May 2004, Fed officials were confident they would lift rates at a "measured" pace, and said so. At every meeting since, the federal-funds rate has risen, staircase-like, by a quarter of a percentage point.

But with the economy back to full strength, rates closer to normal levels and crosscurrents buffeting the outlook, the Fed's confidence about the future path of rates has dissipated. Fed officials still believe rates are more likely to rise than fall, but they figure that may happen irregularly, over several months, depending on the incoming data.

That is, after all, what's usually happened in the past: The recent staircase pattern is anomalous. A more gradual, less predictable path gives Fed officials, especially those worried about raising interest rates too far, time to assess the impact on the economy of past rate moves.

Yet traders tend to think the staircase will continue until the Fed is finished, and are debating whether the Fed is "one and done" or "two and done."

On Thursday, Mr. Bernanke told a congressional committee that the Fed could pause even if inflation risks persisted. He tried to emphasize that a pause need not be a halt: "A decision to take no action at a particular meeting does not preclude actions at subsequent meetings," he said.

Yet markets read the talk of "pause" as if it were a "halt," and futures markets marked down the odds of an increase at the Fed's June 28-29 meeting and at subsequent meetings. Then on Monday, a CNBC anchor quoted Mr. Bernanke as having told her at a function in Washington on Saturday that the markets had misread his testimony and that he was merely trying to create "flexibility" for the Fed. Markets responded by boosting the probability of a rate increase in June. Tuesday, they put the probability at 34 percent.

The recent gyrations suggest that markets continue to expect Fed guidance. "If you ask people why they think the Fed will stop in June, they'll say it's because the Fed said so, not because the data tells them they think the Fed should stop," said Jim Bianco, president of Bianco Research, a Chicago financial research firm.

The market's action also suggests less confidence in the Fed's inflation-fighting credibility, a blow to Mr. Bernanke, who has sought to dispel notions that he is an inflation dove with repeated assertions of the primacy of low inflation. Some investors criticize his testimony last week for ratifying expectations of a pause without the data yet in hand to justify one.

Tom Gallagher, an analyst at ISI Group, an investment firm, said the Fed now has a challenge to its credibility on both inflation and communications. "If these challenges are mishandled, the Fed might have to raise rates beyond its current plans to regain inflation-fighting credibility," he said in a report Tuesday.

Right now, that appears unlikely. After next week's meeting, the Fed will have seven weeks to decide whether to raise rates again. By that time, the data may make the decision clear to both the Fed and the markets.