EBSCN·2026-03-19 07:54Monetary Policy Decisions - The Federal Reserve maintained the federal funds rate target range at 3.50%-3.75%, in line with market expectations, with a probability of over 99% for no rate cut at this meeting[2][5] - The next FOMC meeting is scheduled for April 29, 2026[2] Economic Outlook - The Fed raised its 2026 PCE inflation forecast by 0.3 percentage points, reflecting potential supply shocks[3][10] - Concerns about stagflation were noted, with low job creation levels posing risks to the economy[3][8] Geopolitical Factors - The Fed's decision to pause rate cuts is influenced by ongoing geopolitical tensions, particularly in the Middle East, which could delay future rate cuts[3][14] - Oil prices surged past $105 per barrel following military actions in the region, impacting market stability[13] Market Reactions - Major U.S. stock indices fell, with the Dow Jones down 1.63%, S&P 500 down 1.36%, and Nasdaq down 1.46%[4] - The 10-year Treasury yield rose by 6 basis points to 4.26%, while the 2-year yield increased by 8 basis points to 3.76%[4] Future Rate Cut Expectations - The Fed's future rate cut path will depend heavily on developments in the Middle East, with potential for 2-3 cuts later in 2026 if tensions ease[14] - Current projections suggest a likelihood of no rate cuts until 2027, with market expectations reflecting this outlook[14]