Minutes from the Federal Reserve’s March 17-18 meeting reveal officials are considering both downside risks to employment and upside risks to inflation following the Iran war. Most participants noted that the conflict could weaken the labor market, supporting rate cuts, while others emphasized inflationary pressures that might require hikes. The Fed held its policy rate at 3.5%-3.75%, with projections still showing one rate cut in 2026, though markets remain skeptical about any easing this year.

Minutes from the Federal Reserve’s March 17-18 meeting reveal officials are considering both downside risks to employment and upside risks to inflation following the Iran war. Most participants noted that the conflict could weaken the labor market, supporting rate cuts, while others emphasized inflationary pressures that might require hikes. The Fed held its policy rate at 3.5%-3.75%, with projections still showing one rate cut in 2026, though markets remain skeptical about any easing this year. Officials highlighted the need for “two-sided” guidance on future interest-rate decisions.