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Presidents of multiple Federal Reserve Banks last week responded to the recent stock market fluctuations and gave their expectations for the Fed's monetary policy going forward. Although inflation remains lower than some would like, many believe strong labor markets indicate a March rate hike.

"Despite the market reaction to a perceived increase in inflationary pressures, Fed officials appear undaunted in their view that a rate hike is warranted next month," said NAFCU Chief Economist and Vice President of Research Curt Long. "NAFCU anticipates a split decision with one or two dissenting voters, but right now the odds still favor a quarter-point rate increase."

The Federal Open Market Committee (FOMC), the Federal Reserve's monetary policy-setting arm, raised the federal funds target by a quarter-point to a range of 1.25 to 1.5 in December, but declined to raise rates during its January meeting.

Many have attributed last week's stock market plummet to higher inflation expectations. However, Federal Reserve Bank of St. Louis President James Bullard, during a speech at the University of Kentucky, dispelled worries that a strong labor market would "translate into meaningfully higher inflation."

Federal Reserve Bank of Dallas President Robert Kaplan also indicated that the stock market volatility wouldn't have a big impact on the economy, maintaining his position that the FOMC will raise rates three times in 2018.

FOMC member William Dudley, president of the Federal Reserve Bank of New York, said he expected the economy to continue strengthening above expectations, which would lead the committee to increase rates again in March.

Other members, including Federal Reserve Bank of Chicago President Charles Evans, said the committee should assess inflation data carefully and possibly refrain from raising rates until mid-year.

The FOMC will meet March 20-21.