Fed Likely to Hold Rates Steady as Policymakers Assess Impact of Iran War on Inflation

The Federal Reserve is widely expected to keep interest rates unchanged at 3.5%–3.75% at next week’s meeting as policymakers assess the economic impact of the Iran war and rising energy prices.

The decision from the Federal Open Market Committee would mark the second straight meeting with no rate change after three cuts in late 2025 aimed at supporting the slowing job market.

Investors are closely watching the Fed’s economic projections and comments from Chair Jerome Powell for clues on future policy. Markets currently see the first possible rate cut in October, as geopolitical tensions and higher oil prices raise concerns about renewed inflation.

Meanwhile, Donald Trump has renewed calls for immediate rate cuts, increasing political pressure on the central bank. Markets tracked by CME Group show a 99% probability that rates will remain unchanged at the upcoming meeting.

Article By- Shahzad Ahmad