Analysis Room
Fundamentals, written by the desk.

Initial Jobless Claims for the week ending March 20 will be released on Thursday at 16:00 (Iran time). The latest data indicates that demand for unemployment benefits in the United States remains low and stable.
Initial claims declined slightly by 1,000 to 213,000, coming in better than market expectations of 215,000. This relatively low level suggests that layoffs are not yet widespread and that the labor market remains resilient, despite workforce reductions announced by companies such as Oracle and Morgan Stanley.
Continuing claims also declined to 1.85 million, reinforcing the view that there is no broad-based stress in the labor market.
However, other indicators—such as an unexpected decline in nonfarm payrolls in February and reduced hiring plans among small businesses—suggest that unemployment risks may increase in the near term.
Overall, the current data reflects short-term stability in the labor market, but geopolitical risks and signs of weakening employment growth could exert upward pressure on unemployment and influence Federal Reserve policy decisions in the coming months.
Market Impact:
Market reaction to this data is typically limited, especially under current high-risk conditions. A significant deviation from expectations would be required to trigger a notable response.

• Lower-than-expected claims: bullish for USD
• Higher-than-expected claims: bearish for USD

The Federal Open Market Committee (FOMC) meeting will take place on Wednesday at 21:30 (Iran time). The Federal Reserve is widely expected to keep interest rates unchanged. In addition to the rate decision, updated economic projections from the Committee will also be released.
Given the uncertainty surrounding the Middle East conflict and the trajectory of oil prices, the Federal Reserve is expected to maintain a cautious stance, with a likely hawkish tone in its communication.
Market Impact:
A hawkish tone from Chair Jerome Powell is expected to support the U.S. dollar during the session. Market participants will likely focus on commentary regarding the energy crisis and the anticipated transition of Federal Reserve leadership to Warsh in June.
Ahead of Powell’s speech, the release of updated economic projections may introduce volatility across markets.

The U.S. Producer Price Index (PPI) report for February is scheduled for release on Wednesday, March 18, at 16:00 (Iran time). Market expectations suggest both headline and core PPI will increase by 0.3%.
At the start of the year, CPI inflation came in softer than expected, while PCE inflation—the Federal Reserve’s preferred gauge—has remained elevated. This has resulted in a rare divergence among U.S. inflation indicators, with PCE running higher than CPI. The primary driver of this divergence is declining inflation in the housing sector (which carries a heavier weight in CPI) alongside rising inflation in components with greater weighting in PCE.
It is important to note that these data points are backward-looking. Following the escalation of the Middle East conflict and the sharp rise in energy prices, market participants are now more focused on March inflation data.
We expect February PPI to remain relatively moderate, as both core inflation and goods inflation have shown signs of easing. However, this release is unlikely to significantly impact rate cut expectations, given the emergence of new macro risks.
Market Impact:
A strong market reaction is not anticipated due to the lagging nature of the data. If PPI prints above expectations, it could support the U.S. dollar while pressuring gold, the euro, and equity indices. Conversely, a weaker-than-expected reading is likely to generate only a limited market response.