By Megan Leonhardt
Fed in Focus. Stocks managed a consecutive day of gains Tuesday, the first positive streak since the U.S. launched strikes against Iran at the end of February. On the day, the Dow Jones Industrial Average rose 47 points, or 0.1%. The S&P 500 was up 0.3%, while the Nasdaq Composite rose 0.5%.
The positive returns likely had something to do with the fact that oil prices pulled back from their overnight highs -- though international prices were still hovering above $100 per barrel. Prices at the pump hit a nationwide average of $3.80 per gallon for regular unleaded, according to AAA.
Although investors will continue to watch oil markets again tomorrow, domestic affairs may take center stage. The Federal Open Market Committee is set to hand down its latest decision on rates at 2 p.m. The central bank is widely expected to keep its target range for the federal-funds rate at 3.5% to 3.75%.
Before we get the latest Fed moves, the Bureau of Labor Statistics will release the delayed February producers price index data at 8:30 a.m. ET. It's been a number to watch in recent months, as tariff pressure potentially builds. The consensus call is for a 0.3% month-over-over rise. The core PPI, which excludes volatile food and energy prices, is expected to gain just 0.2%. In January, it jumped 0.5% and 0.8%, respectively.
A cooler print could ease investor worries about inflation, especially given the recent oil surge expected to hit inflation in the coming months. A hotter PPI print, on the other hand, could create big problems for both consumers and the Fed -- and probably for stocks
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What to Watch on Fed Day
All eyes will be on the Fed tomorrow. But the committee's decision on rates is expected to be the most boring part of the day. Instead, you should watch policymakers' economic forecasts for the remainder of the year, along with how Fed Chair Jerome Powell characterizes the latest impacts of global conflicts.
That forecast will be part of the Fed's quarterly Summary of Economic Projections, which provides a look at where officials are expecting labor conditions, inflation, economic growth, and rate policy for the rest of the year and into 2027 and 2028.
Many economists are bracing for officials to pull down their expectations for the economy. Economists at Goldman Sachs, for example, expect the SEP to show higher core and headline inflation for the year, as well as a lower GDP forecast -- topped off with slightly higher unemployment.
Wobbly economic conditions could prompt Fed officials to lower rates more than the single cut they penciled in for 2026 back in December. For now, markets aren't expecting much change in the so-called dot plot, where the median is likely to continue to show one cut in each of 2026 and 2027.
The steady-as-she-goes mentality is likely to persist because the Fed finds itself in a tricky position. The jobs reports so far this year still show a fairly stalled labor market, with January's large payroll gains being wiped out by February's loss. Unemployment is again sitting at 4.4%. Given mixed data of late, how Powell references risks and concerns with the labor market will be worth watching closely.
Meanwhile, oil is up by more than a third since the war against Iran began, stoking fears of future inflation. That's the other big theme to watch for, particularly in Powell's press briefing.
Generally, officials tend to look through oil shocks because they drive up price growth temporarily. But with inflation running above the Fed's 2% target for the past five years, the situation could be more complicated this time around. Moreover, the full effects of higher tariffs have yet to materialize and services inflation remains particularly sticky.
"Expect Powell to counsel patience as central bankers take a wait-and-see approach on the impact and duration of the war," writes RSM's chief economist Joseph Brusuelas.
He expects that Powell will toe the line and signal the Fed will look through an increase in inflation. But Brusuelas adds that Powell could provide some flexibility by noting that monetary policy going forward will be conditional on inflation expectations remaining well anchored.
Wednesday's meeting is slated to be Powell's penultimate as chair, assuming that nominee Kevin Warsh is confirmed in time for the June 16-17 meeting. (The Fed has an April 28-29 meeting; Powell's chairmanship is set to expire in May.) Watch for any details from Powell about his plans -- and whether he intends to stay on the Fed board. His term as a governor isn't up until 2028.
The Calendar
Five Below, General Mills, Jabil, Micron Technology, SailPoint, and Williams-Sonoma report quarterly results tomorrow.
The Bureau of Labor Statistics will release the producer price index for February.
The FOMC announces its monetary-policy decision at 2.pm. on Wednesday. The central bank is widely expected to keep the federal-funds rate unchanged at 3.5% to 3.75%. The FOMC also releases its quarterly Summary of Economic Projections.
What We're Reading Today
-- Nvidia Stock Isn't Moving. These Are the Real Winners and Losers of GTC 2026. -- Will the S&P 500 Hit 8000? Wall Street Is Starting to Doubt -- Oil Prices Rise. Trump Says U.S. Doesn't Need Help on Iran -- Why the Iran War Could Kill the Housing Market's Recovery -- Disney's Bob Iger Era Is Over. How the Stock Did During His Time as CEO -- and What's Next.
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March 17, 2026 19:55 ET (23:55 GMT)
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