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Federal Reserve Chair Jerome Powell stated that a rate hike is not off the table but is unlikely for now. He emphasized the uncertainty surrounding the economic impact of rising oil prices.

Fed's Monetary Policy Outlook

Federal Reserve Chair Jerome Powell noted that the possibility of a rate hike was discussed at the March 18, 2026 meeting, but the vast majority of participants do not see it as their base case. He clarified that while a rate hike is 'not off the table,' it is unlikely for now. Powell added that the economic impact of oil shocks is unpredictable, and prolonged high gas prices could weigh on consumption and disposable personal income.

Balancing Risks Amid Uncertainty

Powell stressed the high degree of uncertainty, stating that the economic effects could be larger or smaller than expected. He highlighted that the Fed is balancing the downside risks to the labor market, which would suggest lower rates, and the upside risks to inflation, which would suggest higher rates or at least no cuts. Powell concluded that the current position, leaning towards a mildly restrictive policy, is the right balance given these conflicting risks.

*Source: YouTube: Reuters (2026-03-18)*

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