Federal Reserve doodle

As the Federal Reserve prepares for its March FOMC meeting, Goldman Sachs forecasts that the committee is likely to maintain its cautious stance, with expectations for a rate cut postponed to June. This projection comes despite numerous changes since the last meeting, none of which seem to hasten the Fed's decision-making. The outlook for a gradual easing cycle is reinforced by recent developments aligning more closely with the Fed's December projections on disinflation progress. Given that other central banks are also adopting a cautious approach, significant currency movements are anticipated to be limited. The focus remains on carry and cyclical factors, leaving the Dollar in a unique position outside these primary influences.

Key Points:

  • Postponed Rate Cuts: Goldman Sachs predicts the Federal Reserve will initiate rate cuts in June, with a slower cycle likely due to recent economic data and inflation trends aligning with the FOMC's less optimistic projections.
  • Global Central Bank Caution: The cautious stance is not unique to the Fed; other central banks globally are also taking a deliberate approach to policy adjustments, impacting currency volatility.
  • Dollar's Unique Position: Given the current global economic landscape, the USD does not fit neatly into either carry or cyclical categories, suggesting that its movements will be influenced by a broader range of factors beyond immediate central bank policies.


The upcoming FOMC meeting is expected to reflect a continued cautious approach from the Federal Reserve, aligning with global central bank trends. This outlook suggests that significant USD movements might be more influenced by carry and cyclical factors rather than direct policy changes in the near term. Goldman Sachs' analysis indicates that while rate cuts are on the horizon, the path to easing will be gradual, mirroring the careful strategies of central banks worldwid

For bank trade ideas, check out eFX Plus. For a limited time, get a 7 day free trial, basic for $79 per month and premium at $109 per month. Get it here.