Weekly Market Commentary March 16th to March 20th 2026

The FOMC decided to leave interest rates unchanged in Wednesday’s meeting, with only one member voting to cut. They also released the quarterly dot plot projection which remains unchanged from December, projecting one rate cut in 2026 and another in 2027. However, the ever-changing futures market has a different opinion as it projects the next rate cut to come in the second half of 2027. Fed Chair Jerome Powell remained steadfast during the press conference, claiming that unemployment is close to where it needs to be and inflation remains under control. When asked about his thoughts on the conflict in the Middle East and how it could impact the economy, he refrained from speculating. While he did acknowledge the uncertainties the conflict presents, he also noted that recent trends could quickly change and ultimately be a non-factor for the long-term.

The week also had the release of the Producer Price Index (PPI) which showed U.S. wholesale inflation increased by more than expected in the month of February. PPI year-over-year was 3.4% and month-over-month was 0.7%. The report confirms inflationary pressures were already making their way through supply chains even before the surge in oil prices. Oil is now 50% higher in March, leaving analysts to suspect further inflationary pressures will arise if things don’t change soon.

The equity markets suffered their fourth down week in a row, as surging oil prices raise uncertainty surrounding inflation and interest rates. The S&P 500 fell 1.9% to 6,507, the Nasdaq fell 2.1% to 21,648, and the Dow Jones Industrials fell 2.1% to 45,578. U.S. Treasury yields rose meaningfully, with the 2-Year 16bps higher to 3.89% and the 10-Year 10bps higher to 4.38%.

Next week will have data on manufacturing and services, as well as commentary from several Federal Reserve governors.