FX.co ★ Fed to Hold Rates Steady, Release Updated Economic Forecasts

The Federal Reserve is widely expected to leave the federal funds rate unchanged in March 2026, maintaining the 3.5%–3.75% target range for a second consecutive meeting as it contends with a challenging economic backdrop. The central bank faces the prospect of an oil shock, stubbornly elevated inflation, and emerging signs of a cooling labor market. Since the January FOMC meeting, oil prices have jumped in response to the conflict with Iran, heightening concerns that inflation could reaccelerate before returning to the Fed’s 2% objective. In this environment, policymakers are likely to reinforce a cautious, wait-and-see stance, effectively embracing a “first, do no harm” approach. Alongside its rate decision, the Fed will publish updated economic projections, which investors will scrutinize for any changes that capture the war’s potential effects on inflation, growth, and the anticipated trajectory of interest rates.