What do economists expect from the Fed in March?

Following the latest data, economists say the risk of the Fed cutting interest rates later and by less is decreasing. Following Fed Chair Jerome Powell’s statement that “We are not far away” from interest rate cuts during his presentation to Congress last week, all eyes are now on the Fed’s interest rate decision meeting to be held on March 19-20. While the Fed is expected to keep interest rates steady for the fifth time in a row at the meeting, economists’ focus will be on the dot chart showing members’ economic projections. If the expectation of three interest rate cuts for 2024 is maintained in the dot chart, the expectation for the first interest rate cut in June will have strengthened. According to Dreyfus and Mellon Chief Economist Vincent Reinhart, the Fed’s March message will be “We are on the right track.” Reinhart believes that Fed members are not far from a sufficient level of confidence for monetary easing. LH Meyer/Monetary Policy Analytics Economist Derek Tang said that the 3.9 percent unemployment rate and the decreasing wage growth rate data have reduced the risk of the Fed delaying or reducing the scale of the interest rate cut. “Powell’s statement that they are not far from a sufficient level of confidence to cut interest rates will still stand,” Tang said. However, there may be differences of opinion among Fed members on how to cut interest rates, according to KPMG LLP Chief Economist Diane Swonk.