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March FOMC Meeting -3

15:21 18-Mar-26

In his press conference, Powell acknowledged that labor demand has softened, creating significant concern in many members of the committee.  He also conceded that most participants have moved from two to one rate cut this year, and that there should be none if there is no progress on inflation.  Although he also admitted that inflation expectations have risen in response to the rise of oil prices, but firmly wrote that off as a one-time inflationary hit, even though the economic effects of war in the Middle East are "uncertain", like just about everything else.

In the face of that, perhaps the most important commentary was the statements that Powell will serve as the pro-temp Chair until a successor is confirmed by the Senate, and that he has not decided whether or not to leave the committee once his term as Chair is over.

The Fed has chosen to hold as expected, glossing over the frozen job market and merely noting that inflation remains "somewhat elevated".  However the dot plot in its economic projections has gravitated strongly toward the higher for longer narrative that our parent CrowdWisers service has long foreseen.  American stock indexes are reacting negatively, and there will be follow up on the press conference if appropriate.

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