📰 In his remarks following the March 2026 meeting, Federal Reserve Chairman Jerome Powell emphasized that inflation is more persistent than expected. Powell stated that core inflation is hovering around 3%, and that a significant portion of current price pressures stems from trade policies.
According to Powell, tariffs, particularly those implemented in recent years, are having a powerful enough impact to account for 50% to 75% of inflation. While the FED previously expected these effects to be temporary, the pressure on prices appears to be lasting longer than anticipated.
At the same time, rising energy prices and geopolitical developments are among other factors pushing inflation upwards. FED officials state that in this environment, inflation remaining above the 2% target makes monetary policy more difficult.
Therefore, Powell explicitly expressed caution regarding interest rate cuts. Emphasizing that interest rate cuts will not occur without a clear decline in inflation, the FED Chairman conveyed the message that "if there is no progress, a rate cut this year will be difficult."
At its March meeting, the Fed kept its policy interest rate unchanged, stating that uncertainties in the economic outlook persist and that the impact of tariffs and energy prices on inflation will be closely monitored.
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