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Fed’s Path Stalls Amid Mounting Shocks and New Risks

Financial Commentary
March 23, 2026 By Samuel Richter, CFP®
Senior Securities Analyst


The Federal Open Market Committee (FOMC) held its benchmark interest rate steady last week, signaling a continued cautious approach to monetary policy. The central bank’s updated interest rate projections or “dot plot” suggests more uncertainty regarding the possibility of a rate cut this year. Twelve of the nineteen participants projected at least one rate cut this year, the same as in December. However, several now expect fewer reductions. The dot plot provides a snapshot of where each Fed official believes rates should be, offering insight into the committee’s collective thinking.

Unexpected Events Disrupt Fed's Progress

The latest complication for the Fed comes from rising tensions involving Iran. Oil prices jumped higher, adding fresh pressure to inflation. Energy markets react quickly in these situations. Higher oil costs can filter through the economy, pushing prices higher. Recent releases show inflation remains sticky and above the Fed’s 2% target.

This is the latest in a series of unexpected events disrupting the Fed’s progress. Pandemic-era supply chain bottlenecks, tariffs, and ongoing geopolitical conflicts have stacked up. These one-off shocks keep near-term inflation expectations above the Fed’s goal, while long-term expectations remain well-anchored.

Still Looming: The Impact of Inflation

The FOMC’s Summary of Economic Projections expects inflation to end the year at 2.7%, slightly above their 2% target. Surveys of consumers suggest inflation could remain higher, in the low-to-mid 3% range. The gap between the Fed’s projections and market expectations highlights uncertainty about how temporary shocks, like energy prices and geopolitical events, will feed through the economy. It also helps explain why the Fed remains cautious.

While the impacts of any single event might fade over time, the steady accumulation makes the path for interest rates less certain. This supports the Fed’s measured approach going forward. Investors will continue to watch closely to see how the Fed balances these risks with its dual mandate of maximum employment and price stability.

The Fed’s cautious stance signals that while the worst of inflation may be behind us, uncertainty from shocks and market expectations means future rate cuts are unlikely to come soon. If you have any questions, please reach out to an advisor today. Your financial success matters to us .

About the Author

Samuel Richter, CFP®

Samuel Richter is a Senior Securities Analyst within Security National's Wealth Management division. He began his career at SNB in 2020. A Certified Financial Planner (CFP®), Samuel holds a Bachelor of Science degree in finance from Iowa State University.

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