Wednesday's Fed meeting is on the horizon - the key event of March

Current situation 

Futures on the S&P 500, Dow and Nasdaq are falling after a difficult week, when the Dow showed its worst fall since 2023 (-4.4%). The US Treasury Department Bessent said that there is no guarantee of preventing a recession, and Trump did not rule out such a scenario either. In addition, uncertainty around trade tariffs increases market pressure - a possible trade war with the EU threatens transatlantic business worth $9.5 trillion.

Against this background, capital prefers to wait out the geopolitical storm in the "safe haven" - the US dollar, which puts pressure on the stock market and the cryptocurrency section. Also, investor caution is traditionally observed before important fundamental events that will take place this week.

FA drivers of the week: what matters for markets?

Meetings of global central banks

The Fed, the Bank of England, the Bank of Japan and the Central Bank of Russia will announce their rate decisions. No rate changes are expected, but the tone of their chairmen's speeches at subsequent press conferences will be important.

The market will be especially focused on the tone of the speech of Fed Chairman Jerome Powell. If the rhetoric is "hawkish" (tough), this may mean the Fed is cautious due to inflation risks and Trump's trade tariffs. A tough tone could lead to a rise in the dollar and a fall in stocks, especially in the tech sector,

German fiscal stimulus

Parliament will consider a €500 billion program. If approved, it will support the euro and European markets, but the vote remains risky.

Ceasefire in Ukraine

A peace plan is being discussed, a call between Trump and Putin is possible. If the agreement is confirmed, geopolitical risks will decrease.

US Trade Policy

Markets are waiting for news on tariffs until April 2. Their introduction will cause turbulence, but the start of negotiations on new trade deals may improve sentiment.