Analyst: Federal Reserve Meeting May Be Affected by Middle East Crisis and Oil Price Surge, Market Has Canceled Two Rate Cut Expectations

Gate News reports that on March 18, Aptus Capital Advisors Fixed Income Chief John Thainer stated that the Federal Reserve meeting will undoubtedly be influenced to some extent by the Middle East conflict and rising oil prices, but this meeting could determine the next direction of the market. Although rate cuts are no longer under consideration, the market will focus on the dot plot (Federal Reserve interest rate forecast chart), divergences among Fed officials relative to the median forecast, and any language in Powell’s press conference suggesting whether they intend to ignore price increases caused by commodity supply shocks. After the surge in oil prices, the market has already priced out the two rate cuts expected earlier this year, but if the conflict ends quickly, these rate cut expectations will be rapidly re-priced.

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