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In keeping with their commitment to enhanced transparency and communication, policymakers at this week’s Federal Reserve (Fed) meeting will likely maintain their recent messaging and keep interest rates steady. Easier monetary policy remains likely at some point this year, but more evidence that disinflationary trends are firmly in place is necessary before rate cuts can begin. The release of the March meeting “dot plot” (Fed projections for short-term interest rate levels) may shake up financial markets after the unexpectedly dovish December “dot plot” helped to sustain the bullish sentiment as 2023 came to a close.
This week’s economic releases include new data on the state of the housing market. Housing starts and building permits come out on Tuesday, followed by existing home sales on Thursday.1 After the manufacturing activity surprised to the upside last month,2 the S&P Global Manufacturing and Services Purchasing Managers’ Index (PMI) data release on Thursday may confirm the rebound.
Sources:
1MarketWatch – U.S. Economic Calendar; as of 3/18/24
2S&P Global – Manufacturing conditions improve at fastest pace since July 2022; 3/1/24
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