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  1. US Fed to announce interest rate decision today; what we know so far

US Fed to announce interest rate decision today; what we know so far

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2 min read • Updated: March 20, 2024, 6:26 PM

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The United States Federal Reserve will announce the outcome of its two-day meeting on interest rates. Markets expect a cut or status quo on rates, especially after some central banks have held back on further interest rate hikes.


The Federal Open Market Committee (FOMC) will conclude its two-day meeting on Wednesday, March 20 to deliver a discussion on one key issue: interest rates, also known as the federal funds rate.

The committee, which is headed by Federal Reserve Chair Jerome Powell, has kept the rates unchanged at 5.25% – 5.50% since July 2023. Market watchers are keenly looking at whether the Fed will cut the rates looking at signs of recovery in the economy or keep them unchanged in the face of persistent inflation concerns.

Read more: Will the US Fed cut interest rates this week? Here’s what the markets think

In its meeting in January 2024, the Fed noted “that the policy rate was likely at its peak for this tightening cycle.” In line with these expectations, last week the Reserve Bank of Australia held its cash rate target at 4.35%, while the European Central Bank left interest rates unchanged at 4%, this comes after both took on hikes in the past to combat inflation.

The Fed’s decision is much awaited as markets are still digesting the Bank of Japan’s decision yesterday to move away from negative interest rates and hiking its interest rates to a range of 0 – 0.01% from -0.01%.

Read more at: Bank of Japan ends negative interest rate policy as inflation fears loom; raises interest rates after 17 years

FOMC’s US interest rate decision will also be made keeping in mind the inflation data that was released last month. The inflation rate, or US Consumer Price Index (CPI) for February recorded a 3.2% annual increase, which is well above the Fed’s expectations of 2% and marginally above market expectations of 3.1%.

“The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent” - FOMC (January Meeting Minutes)

The Fed’s rate decisions will be delivered in a dot plot, which is a quarterly chart that shows each Fed official’s predictions about the direction of federal interest rates. In December, the document showed consensus between officials for three rate cuts in 2024. This is in line with market expectations, which expect lower rates in 2024 although stacked towards the second half of the year.