FOMC Meeting Summary: March 2026

The second FOMC meeting of the year has concluded, with the federal funds rate (as expected) maintained at the current range of 3.50–3.75%. The Federal Reserve Board of Governors voted unanimously.

The Committee upgraded its 2026 GDP growth forecast to 2.4% and raised its inflation expectations to 2.7% for both the PCE and Core PCE indices. The interest rate forecast (EFFR) remains unchanged: one 0.25% cut in 2026 to a range of 3.25–3.50%, and one cut in 2027 to 3.00–3.25%, with this range maintained over the long-term horizon.

Summarizing Powell’s remarks, the Fed will continue to maintain a "wait-and-see" stance. The economy remains resilient (growth and consumption persist), and the current rate level is assessed as being close to neutral or moderately restrictive. At the same time, the balance of risks has become asymmetric — the focus has shifted toward inflation, which remains above target, shows signs of re-acceleration (PCE: 2.8–3.0%), and may further increase due to energy prices and tariffs.

Against this backdrop, the labor market is showing signs of cooling (reduced demand for labor and sluggish new job creation). However, the labor market does not yet necessitate immediate monetary policy easing. Accordingly, the risks of premature easing are currently assessed as being higher.

Powell repeatedly spoke about the high level of uncertainty in geopolitics. The primary transmission channel is through energy prices: rising oil and gasoline prices could temporarily accelerate inflation and dampen consumer sentiment. Nevertheless, the Chairman views such shocks as likely transitory, though he admits that their scale and duration are currently impossible to assess.

FedWatch

Market rate expectations for the April meeting: 4.1% hike; 0% cut. The market no longer prices in any rate cuts by the end of 2026 (compared to two projected cuts at the beginning of the year).

The market reaction is corresponding:

• S&P 500 Futures: -2.28%
• VIX: +20% (25.87)
• Gold Futures: -6.33%
• Dollar Index Futures: +0.51%
• ETF TLT (20+ year treasuries): -0.21%
• Bitcoin Futures: -5.69%.