Fed Policy Outlook for March Meeting

New projections from the CME indicate that the Federal Reserve has a high probability of keeping interest rates unchanged at its March meeting, with an 86.6% chance of no rate cuts. In contrast, the likelihood of a 25-basis-point reduction stands at just 13.4%.

April Policy Path Insights

Looking ahead to April, market expectations suggest a slightly higher probability of a cumulative 25-basis-point rate cut at 25.5%. However, the majority scenario still points to unchanged rates with a 72.2% probability. A more aggressive 50-basis-point cut remains highly unlikely at just 2.2%.

Economic Context and Market Signals

These probabilities highlight the Fed's cautious approach amid persistent inflationary pressures and economic uncertainty. While some investors remain hopeful for accommodative monetary policy, core indicators suggest inflation control remains fragile, reinforcing the central bank's measured stance.

  • March Rate Hold Probability: 86.6%
  • March 25-BP Cut Probability: 13.4%
  • April Cumulative 25-BP Cut Probability: 25.5%
  • April Rate Hold Probability: 72.2%