Global markets are keeping a close eye on the Fed’s interest rate decision. While it is widely expected that the policy rate will remain unchanged, investors will closely monitor Chairman Powell’s remarks.

The tariffs imposed by US President Donald Trump on major trading partners and the retaliations from these countries continue to increase geopolitical risks, leading to a rise in risk sentiment in these uncertain times. Concerns persist about Trump’s trade war through tariffs potentially triggering inflationary pressures in the US.

Investors’ attention has now turned to the interest rate decision by the Fed to be announced tonight and the speech that Fed Chairman Powell will make following the decision. While the markets are certain that the Fed will keep the policy rate steady, signals from the policy statement and Powell’s guidance are expected to have an impact on market direction. The interest rate decision will be announced at 10:00 p.m.

NEGOTIATIONS IN RUSSIA-UKRAINE WAR

Additionally, limited talks between the US and Russia to end the Russia-Ukraine war have created some optimism.

Regarding this matter, Trump, in a statement on his Truth Social account, noted that his phone call with Russian President Putin went very well and was productive. In his statement, Trump used the phrase, “We have agreed on an immediate ceasefire in all energy and infrastructure sectors.”

FITCH LOWERS GROWTH EXPECTATION

Furthermore, international credit rating agency Fitch Ratings has lowered this year’s growth expectation for the global economy from 2.6% to 2.3% due to the trade war initiated by the US. The expectation for next year has also been lowered from 2.3% to 2.2%. According to data released in the country, the number of new housing starts saw an increase of 11.2% in February, exceeding market expectations, while the number of construction permits issued dropped by 1.2% on a monthly basis in February.

Industrial production in the US saw a 0.7% increase in February, surpassing market expectations.