Central Banks Pause Rate Cuts as Iran Conflict Pushes Up Energy Prices
Fed holds rates at 3.5%–3.75% and projects one cut this year; rising oil and U.S. gas at $3.84 a gallon have prompted caution ahead of the BoE MPC decision at 12:00 GMT.
BBC NewsImpact of Iran war expected to bring hold in interest rates
Fox BusinessWill the Federal Reserve cut interest rates in 2026?
Epoch TimesHow Major US Stock Indexes Fared March 18
Chicago Sun-TimesFed projects one rate cut this year as Powell vows to stay on until DOJ investigation is finished
Overview
The Federal Reserve voted to hold its benchmark interest rate in the range of 3.5%–3.75% for the second straight meeting, citing uncertainty from the US‑Israel war with Iran.
US‑Israeli strikes on Iran have driven up oil and gas prices, with U.S. gasoline at a nationwide average of $3.84 per gallon, prompting central banks to pause planned rate cuts, officials said.
Federal Reserve Chair Jerome Powell said he has "no intention" of leaving the Fed until an investigation into his congressional testimony about a building renovation is resolved.
Markets and lenders have pulled mortgage deals as average two‑year UK fixed rates rose from 4.83% at the start of March to 5.30%, and five‑year rates rose from 4.95% to 5.35%, Moneyfacts said.
The Monetary Policy Committee's latest decision at the Bank of England will be published at 12:00 GMT, and markets will watch for whether the Bank follows the Fed in holding rates, officials said.
Analysis
Center-leaning sources frame the market drop as primarily driven by inflation and Middle East uncertainty, using attention-grabbing language (e.g., "slides nearly 800 points", "stubbornly high") and selective emphasis on oil/gas prices and the VIX spike. Editorial choices prioritize economic downside while quoting Fed uncertainty (source content) as explanatory context.
FAQ
The Federal Reserve is holding its benchmark interest rate in the range of 3.5%–3.75%.
The Fed projects one rate cut this year.
Rising oil and gas prices due to US-Israeli strikes on Iran, with U.S. gasoline at $3.84 per gallon, and uncertainty from the US-Israel war with Iran.
Fed Chair Jerome Powell stated he has 'no intention' of leaving the Fed until an investigation into his congressional testimony about a building renovation is resolved.
The Bank of England's Monetary Policy Committee decision at 12:00 GMT; markets are watching if the BoE will follow the Fed in holding rates.
