The Federal Reserve kept interest rates unchanged at its latest meeting, but warned that higher energy prices could prolong their fight against inflation. This comes as tensions in the Iran war threaten to increase costs and lead to higher prices. Fed Chair Jerome Powell said there’s little room for rate cuts, suggesting it will be harder to justify reductions unless the economy weakens.
The decision marks the second consecutive meeting with no change, and officials voted 11-1 to maintain the benchmark federal funds rate between 3.5% and 3.75%. Treasury yields climbed, closing at 4.256%, while stock markets fell due to increased uncertainty.
Source: https://www.wsj.com/economy/central-banking/fed-holds-steady-and-maintains-rate-cut-projection-2c378384