FOMC Statement

MNI looks at the Fed's upcoming rates decision.

Download Full Report Here: https://media.marketnews.com/Fed_Prev_Mar2026_With_Analysts_8faa54d89e.pdf This update of our March 13 Fed preview includes analyst expectations - starting page 41 March 2026 FOMC Analyst Views: Cuts Delayed, Not Denied Analysts are unanimously agreed that the FOMC won't adjust rates at the March meeting, based on 31 meeting previews we read. * The median analyst sees 50bp of rate cuts remaining in the cycle, though there are almost as many who eye 75bp cuts. That's not much changed since the January meeting (same 50bp MNI median) despite a sharp repricing out of rate cuts in the market due to the fallout from the war in the Middle East. * For those analysts who see cuts resuming, the expectation for the restart is split between June and September of this year, even with multiple analysts having pushed back their timelines following the January employment report and/or the breakout of hostilities in the Middle East. * March Dot Plot: Expectations are overwhelmingly that the rate dot medians in the new SEP will remain unchanged (implying the median FOMC member still sees 1 rate cut this year and another in 2027). We saw only one analyst (ING) expect the 2026 dot to be revised to show no implied cuts. * Two analysts (BofA and Deutsche) expect the longer-run dot to be nudged up to 3.1% from 3.0%. * March macro forecasts: Opinion is slightly split on how the macro forecasts will shift vs December. Most analysts see 2026 growth revised lower, though some expect an upgrade. There is broad expectation that 2026 PCE inflation (especially headline) will be revised meaningfully higher, to reflect the latest rise in energy prices. * March Statement: Among those who expressed opinions on dissents, there appears to be consensus that there will be two in favor of a rate cut (Miran and Waller), though some see only one (Miran) and some see three (with Bowman). * Tweaks to the Statement are mostly seen as limited, with several analysts expecting language added to recognize increased uncertainty and risks to the dual mandate goals due to the conflict in the Middle East.

Download Full Report Here: https://media.marketnews.com/Fed_Prev_Mar2026_1f3c645c05.pdf EXECUTIVE SUMMARY * The FOMC will hold the Federal Funds rate at 3.50-3.75% for a second consecutive meeting in March, in what increasingly looks like a prolonged pause before the next move. * The outlook for policy changes has been complicated by events in the Middle East. With energy prices soaring, markets have swung from anticipating two 25bp rate cuts this year to now not even pricing one fully. * The updated Dot Plot is likely to show the same median expectation for the rate path as December's, including one 25bp cut by end-2026, which combined with a largely unchanged statement will effectively maintain the easing bias. * Incoming data for the year so far won't allay hawks' skepticism that inflation is headed sustainably to 2%, and while job gains remain soft at best, the labor market hasn't deteriorated to the point once feared. * The threat posed to both dual mandate variables from the conflict in the Middle East gives policymakers even more reason to wait and see how things develop. * We suspect that most on the FOMC, including the core leadership, will be more concerned with the potential demand destruction from the ongoing energy supply-side shock, than with the inflationary implications. * But this is no time for pre-emptive action given inflation remaining above-target and expectations beginning to pick up, and it will take some months before a case can be made to resume easing. MNI's separate preview of sell-side analyst summaries to follow on Monday March 16