By Caitlin McCabe

The Federal Reserve held interest rates steady and preserved a path to cutting rates this year amid a backdrop of high oil prices, a sluggish labor market and above-target inflation.

Officials voted 11-1 to hold the benchmark federal-funds rate in a range between 3.5% and 3.75%, the second consecutive meeting with no change. Fed Chair Jerome Powell's press conference to discuss rates and the economy is expected at 2:30 p.m.

With the war sending energy prices sharply higher and threatening to stoke inflation, the question is not so much when the Fed will cut rates, but whether they can credibly keep telling markets to expect a rate cut at all. This Fed meeting is Powell's penultimate as chair.

Brent crude prices jumped 3.5% Wednesday and a February wholesale inflation report came in hotter than expected, sending stocks lower ahead of the Fed decision. The Dow was stable after the Fed announcement, down nearly 1% on the day.

Futures for Brent crude climbed to almost $110 a barrel and WTI crude, the U.S. benchmark, also rose, reversing an earlier decline, after Israel struck Iran's South Pars gas field, which Tehran shares with Qatar.

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(END) Dow Jones Newswires

March 18, 2026 14:20 ET (18:20 GMT)

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