Hawkish Fed Weighs on Markets (03.19.2026)

Markets reacted to a firm Federal Reserve stance as policymakers held rates steady and signaled limited easing ahead, reinforcing U.S. dollar strength. 

EUR/USD remained stable near 1.1550 as investors balanced Fed guidance with expectations that the ECB will also keep rates unchanged. The Japanese yen weakened toward the 160 level following the Bank of Japan’s decision to hold policy despite internal calls for tightening, while rising oil prices added further pressure. Precious metals stayed subdued, with gold stabilizing after a prolonged decline and silver holding near recent lows, reflecting the impact of higher yields and a stronger dollar. Sterling also came under pressure, breaking key support levels as broader dollar strength dominated sentiment.

Euro Holds Stable Near 1.1550

EUR/USD remained stable around the 1.1550 level as the US dollar steadied while investors adopted a cautious stance ahead of the Federal Reserve’s policy announcement. The Fed kept its benchmark interest rate unchanged within the 3.50%–3.75% range in March. Meanwhile, the European Central Bank is also anticipated to leave its deposit rate unchanged at 2.0% during Thursday’s meeting.

For EUR/USD, the initial resistance is seen at 1.1550, while the closest support is positioned at 1.1410.

JPY Weakened Toward 160

The Japanese Yen weakened toward 160 per dollar, nearing its lowest level since July 2024. The decline followed the Bank of Japan’s decision to keep its policy rate unchanged, despite a second consecutive dissent from board member Hajime Takata. Takata advocated for a hike to 1% to address mounting inflation risks. Adding to the currency's woes, oil prices surged as new attacks on Middle Eastern energy infrastructure intensified the Iran conflict, highlighting Japan's vulnerability to rising import costs and escalating geopolitical instability.

Technically, resistance stands near 160.70, while support is firm at 159.00.

Gold Stabilizes After Six-Day Slide

Gold hovered near $4,830 per ounce, following its longest losing streak since late 2024. Prices flattened as the Federal Reserve’s hawkish stance outweighed lingering geopolitical risks. By holding rates steady and signaling only a single cut for 2026, Chair Jerome Powell reinforced a restrictive outlook, emphasizing that any future easing remains strictly dependent on more convincing inflation data.

Gold sees support near $4900, while resistance is around $4750.

Sterling Breaks Support Below 1.3300

GBP/USD tumbled 0.7% on Wednesday, decisively breaking through the critical 1.3300 support level. This decline extends a broader retreat from the January peak of 1.3870, leaving the pair trading below key daily moving averages. A sharp bearish candle confirmed the end of a two-week consolidation phase. Sentiment was further dampened by the Federal Reserve’s decision to hold rates as Chair Jerome Powell’s relatively hawkish remarks supported the US Dollar across the board.

From a technical view, support stands near 1.3210, with resistance around 1.3330.

Silver Stabilizes Above $75

Silver stabilized above $75, following a 5% plunge in the prior session. The metal faced ongoing pressure from the Federal Reserve’s hawkish stance and surging oil prices. While one rate cut is still projected for 2026, policymakers clarified that easing will only begin once inflation demonstrates a definitive downward trend.

From a technical view, resistance stands near $77.20 while support is located around $74.10.