Like Munoz, Deutsche Bank economists expect the Fed to stick to its three rate decreases for this year, starting in June, on Wednesday. They also expect central bank policymakers to decrease their 2025 rate cut projection to three from four in December due to sticky inflation.
"The main message from the March summary of economic projections should be that the Fed will have little tolerance for further upside inflation surprises, and if they were to occur, expectations for policy easing this year will be dialed back (all else being equal)," said.
Other economists advise against interpreting median projections. EY chief economist Gregory Daco anticipates the median projection for rate cuts to drop to two on Wednesday, but lower inflation readings will demand four rate cuts this year.
Tim Duy, chief U.S. economist at SGH Macro Advisors, believes eight of the Fed's 19 officials could cut less than in December without changing the median.
The "careful" tweaks that will be discussed in Fed Chair Jerome Powell's press conference following the meeting, as well as the hedging that will accompany rate decreases.
Are expected to garner more attention than the changes that will be made to the Federal Reserve's policy statement on Wednesday.
It is anticipated that these changes will attract less attention. There are a lot of people who are participating in the market, and they are expecting that Powell would provide some clarification about when the Federal Reserve will finish reducing its balance sheet, which is currently at $7.6 trillion.
Because Yelena Shulyatyeva, a senior economist at BNP Paribas, anticipates that "they need to do a lot at this meeting," she pointed out that in order to unveil the plan in May and start decreasing reductions in June, "they need to do a lot at this meeting."
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