It’s Fed Day everyone! No, it’s not a national holiday…so make sure you show up to work as usual. But definitely keep an eye on Washington around 2 pm Eastern when the Federal Reserve announces the results of its latest gathering. Chairman Jay Powell & Co. won’t cut rates today. But what policymakers say about economic growth and inflation in their post-meeting statement, and what Powell says at his press conference, could move markets notably.
Ahead of the meeting, here’s a chart showing how expectations for the level of the Secured Overnight Financing Rate (SOFR) have changed over time. SOFR is a benchmark short-term rate that financial instruments like derivatives, loans, and other products are priced off of – and it tracks the federal funds rate set by the Fed extremely closely.
Source: Atlanta Fed
What should jump out at you right away? Expectations for the future level of interest rates have DROPPED notably in the last month. That’s shown by the lower level of the green line (expectation as of 3/14/25) relative to the blue line (expectations as of 2/14/25). That reflects worries that tariffs, uncertainty, and declining consumer confidence could lead to slower growth – which the Fed would react to by cutting rates.
Meanwhile, the highly anticipated phone call between President Trump and Russian President Vladimir Putin didn’t result in much concrete progress. The US touted a Russian promise to temporarily avoid striking energy and infrastructure assets, and hold future discussions on a full ceasefire. But Putin wouldn’t agree to Trump’s request for a broader 30-day halt to the war.
Then less than 24 hours later, both Russia and Ukraine accused each other of violating the ceasefire terms amid a hail of drone and missile attacks and counterattacks. Crude oil bounced back after giving up some ground following the call, while gold rallied further on the news of fresh attacks.
