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Power Play: Chances of a September rate hike just dropped

Federal Reserve Chair Janet Yellen speaks at the Institute for New Economic Thinking Conference on Finance and Society at the IMF in Washington on May 6, 2015.
Kevin Lamarque | Reuters

Barclays is shifting its interest rates hike call to March 2016 from September of this year.

This move follows two straight days of market volatility where the Dow lost more than 500 points on Friday and another 1,000 points at the open on Monday.

Robert Pavlik, chief market strategist at Boston Private Wealth, tells CNBC's "Power Lunch" the probability of a September rate hike has dropped significantly.

Read More The Fed hike could LOWER interest rates

"There was a 70 percent chance of a rate hike in September, now the chances are 20 percent," Pavlik said.

He believes the Fed is scared of causing more extreme market volatility, but at the same time the Fed wants to increase its ammunition in case the economy falters down the road.

"The Fed wants to raise rates one time this year. We're not in an environment where emergency funding is required, but if something happens, they have nothing but quantitative easing," Pavlik said.

The Dow, and Nasdaq are still lower during trading, but have rallied back from the initial market plunge.