The Federal Reserve is expected to hold interest rates steady on Wednesday, with some analysts anticipating insight from the central bank on the possible economic impact of the Iran war.
Key Facts
Traders have priced in 99% odds of the Federal Reserve holding interest rates between 3.5% and 3.75%, according to CME’s FedWatch tool, matching consensus economist expectations, according to FactSet.
Betting markets similarly favor no change to interest rates: Polymarket placed odds of nearly 100% for interest rates to be held, while Kalshi projected just two Fed officials—Stephen Miran (99%) and Christopher Waller (70%)—to dissent, potentially matching January’s vote.
The Federal Open Market Committee will also publish an update to the Fed’s “dot plot,” a graph outlining the central bank’s policymaking decisions, after its last revision in December.
David Kelly, JPMorgan Asset Management’s chief global strategist, wrote the Fed will likely emphasize the Iran war has added “further uncertainty” to the outlook for inflation and the job market, though Kelly noted the central bank’s forecasts could look “remarkably similar” to its last “dot plot” update.
What Has Donald Trump Said About Interest Rates?
President Donald Trump has pressured the Fed and Fed Chair Jerome Powell to cut interest rates more quickly, writing on Truth Social on Wednesday: “When is ‘Too Late’ Powell lowering INTEREST RATES?” After the Fed voted to hold interest rates in January, Trump said the U.S. should be paying the “LOWEST INTEREST RATE OF ANY COUNTRY IN THE WORLD” because of the “vast amounts of money flowing into” the U.S. because of his tariffs.
What Have Fed Officials Said About Lowering Interest Rates?
Minutes from the Federal Open Market Committee’s January meeting suggested the Fed was divided over further interest rates. That meeting had “several” Fed board members arguing interest rate hikes may be necessary if inflation remained above its 2% goal, while some officials argued interest rates should be held “steady for some time” as policymakers assessed incoming economic data. A “number” of officials indicated lower interest rates “may not be warranted” until there was “clear indication” that inflation was slowing.
Will The Fed Cut Interest Rates This Year?
The Fed’s “dot plot” indicated just one quarter-point interest rate cut is expected in 2026, followed by one additional cut in 2027. A statement from the Fed was tweaked to note the central bank would consider the “extent and additional adjustments to rates,” mirroring language last used by the Fed in December 2025, after which the FOMC opted not to approve cuts until September 2025. Fed governor Michelle Bowman said in January the Fed should “remain ready” to cut interest rates further, citing “signs of fragility” in the job market and arguing the central bank should avoid signaling a pause in rate cuts unless there were “clear and sustained” improvements. The Bureau of Labor Statistics reported a further decline in the labor market in February: The U.S. lost 92,000 nonfarm jobs and the unemployment rate rose to 4.4%, marking a sharp turnaround from the 126,000 jobs added in January. Despite the weakening job market, inflation has remained above the Fed’s 2% target, potentially strengthening arguments against interest rate cuts. Core consumption expenditures index data—the central bank’s preferred inflation reading—showed annual inflation rose more than expected to 3.1% in January. The Bureau of Labor Statistics reported Wednesday that wholesale inflation also accelerated, rising to 3.4% in February and 0.7% from January to February, well above estimates of 2.9% ad 0.3%, respectively.
Surprising Fact
If Bowman, Miran and Waller each cast dissenting votes, it would mark the first time three Fed governors dissent at a policy meeting since 1988. Bowman and Waller cast dissenting votes during the Federal Open Market Committee’s meeting in July 2025, marking the first double dissent by Fed board members since 1993 before January’s vote.
#USFebruaryPPISurgedSurprisingly #SECClarifiesCryptoClassification #astermainnet #MarchFedMeeting BitcoinHits$75K#YZiLabsInvestsInRoboForce