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Foreign exchange market outlook: Super central bank week, decisions of six major central banks, the Fed is expected to remain on hold
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Hello everyone, today XM Forex will bring you "[XM Group]: Foreign exchange market outlook: Super central bank week, six major central bank decisions, the Federal Reserve is expected to stay on hold". Hope this helps you! The original content is as follows:
XM: Foreign exchange market outlook: Super central bank week, resolutions of six major central banks, the Federal Reserve is expected to remain on hold
Thursday: Federal Reserve interest rate resolution
At two o'clock in the morning on Thursday, the Federal Reserve will announce the results of the March interest rate resolution. This is the second resolution this year and the first resolution since the conflict between the United States and Iran began. The outcome of the interest rate decision and Federal Reserve Chairman Powell's speech can profoundly affect market participants' expectations for the U.S. macroeconomy in the www.xmtraders.coming months, and will also trigger violent fluctuations in the gold and dollar markets.

▲XM chart
The mainstream market expectation is that the Federal Reserve will maintain the federal funds rate unchanged at 3.5% to 3.75%. According to CME's "Fed Watch": the probability of the Fed keeping interest rates unchanged is 99.2%, and the probability of cutting interest rates by 25 basis points is only 0.8%. It is almost certain that the Fed will not cut interest rates at this resolution.
The conflict between the United States and Iran has caused international oil prices to continue to run near US$100 per barrel, which may lead to a sharp increase in the inflation rate in the United States in March. If the conflict between the United States and Iran lasts too long, the United States falls into a quagmire of war, and international oil prices stabilize above $100, the inflation rate in the United States may gradually get out of control in the www.xmtraders.coming months.
For the Federal Reserve, maintaining price stability is a core mission. Once inflation data continues to rise, the Fed will have to tighten monetary policy. From expectations of a Fed rate cut to expectations of a Fed rate hike, during this dramatic shift in expectations, the U.S. dollar index is likely to receive a significant boost.
weekFour: Interest rate decisions of the central banks of Switzerland, the United Kingdom, and the Eurozone
In addition to the interest rate decisions of the Federal Reserve, there are also interest rate decisions of the Swiss National Bank, the Bank of England, and the European Central Bank. The results of the interest rate decisions of these three central banks will most likely remain unchanged.

▲XM chart
For the European Central Bank, it has stopped cutting interest rates since June 2025. Because since February 2024, the core inflation rate in the euro zone has been below 3%, the problem of high inflation has been basically resolved. Coupled with the Eurozone's unemployment rate falling from 6.3% to 6.1% in the past three months and the labor market performing well, the ECB has no reason to continue cutting interest rates.
For the Swiss National Bank, starting from 2025, the Swiss National Bank will no longer cut interest rates. Unlike the European Central Bank, the Swiss National Bank chose not to cut interest rates after lowering its benchmark interest rate to 0%. Switzerland's latest core inflation rate is 0.2%, the lowest since August 2021, and is only 0.3 percentage points away from deflation. The Swiss National Bank actually still has the willingness to cut interest rates, but because it has already dropped to the floor price, there is no way to continue to cut interest rates.
The situation of the Bank of England is quite special, because the Bank of England is actually still in the interest rate cutting channel. In December 2025, the Bank of England just cut interest rates by 25 basis points. The reason why market participants believe that the Bank of England will keep interest rates unchanged at the March interest rate decision is because Iran's blockade of the Strait of Hormuz caused international oil prices to exceed US$100 per barrel, which is a key factor that potentially triggers high inflation. The Bank of England's choice to remain on hold is the most rational choice.
Tuesday to Wednesday: Bank of Australia and Canada interest rate decisions

▲ If expected, the Reserve Bank of Australia will be the only central bank to choose to raise interest rates during this super central bank week. In fact, in February this year, the Reserve Bank of Australia already raised interest rates by 25 basis points. If interest rates are raised again in March, an interest rate hike channel will be formed and the value of the Australian dollar will be boosted. Since June 2025, Australia's core inflation rate has increased from 2.9% to 3.4%, which is the fundamental reason why the Reserve Bank of Australia chose to raise interest rates. If interest rates are not raised as soon as possible, Australia may soon suffer from hyperinflation.
At 21:45 this Wednesday, the Bank of Canada will announce the results of its interest rate decision. Mainstream expectations are that it will maintain the benchmark interest rate unchanged at 2.25%. The last time the Bank of Canada raised interest rates was in October 2025.Both interest rate decisions in February and January 2026 chose to remain on hold. The mainstream view is that the Bank of Canada's interest rate cut is mainly based on the economic sanctions imposed by the United States on Canada. At this stage, the United States is busy with Middle East affairs and has no time to take into account the sanctions against Canada, so there is no need for the Bank of Canada to continue to cut interest rates.
XM risk warning, disclaimer, special statement: The market is risky, so investment needs to be cautious. The above content only represents the personal views of analysts and does not constitute any operational advice. Please do not rely on this report as your sole reference. Analysts' views may change at different times and will be updated without notice.
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