FOMC to Take Wait-and-See Approach on Oil Shock Impacts From Middle East Conflict, Fed Chair Powell Says

03:48 PM EDT, 03/18/2026 (MT Newswires) -- The impact of the conflict in the Middle East and the resulting oil price shock is unclear, and the Federal Open Market Committee is taking a "wait-and-see" approach, Federal Reserve Chair Jerome Powell said Wednesday at a press conference.

"In the near term, higher energy prices will push up overall inflation, but it is too soon to know the scope and duration of the potential effects on the economy," Powell said.

At its meeting, the Federal Open Market Committee kept the federal funds rate at 3.5% to 3.75%.

Although near-term measures of inflation have risen in recent weeks, most longer-term measures remain consistent with the committee's target of 2%, Powell said.

Even with job gains remaining low, due in large part to lower immigration and labor force participation, the US economy is "doing pretty well" and expanding at a solid pace, Powell said. However, he said the committee is concerned about effectively zero-net job creation in the private sector. "I would say it does have a feel of downside risk, and it's not kind of a really comfortable balance," he said.

Regarding the ongoing legal cases involving him, Powell said that he has no intention of leaving the board until the investigation is "well and truly over with transparency and finality," and added that he had not decided on whether to continue to serve as a governor after his term as chair ends in May.

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