Fed Chair Powell speaks at Harvard as Iran war stirs inflation fears
Federal Reserve Chair Jerome Powell is set to speak at Harvard University as the Iran war fuels inflation fears and gas prices rise. The Fed may face a dilemma in responding to the shock, which could simultaneously feed inflation and slow the economy.
Federal Reserve Chair Jerome Powell spoke at Harvard University. The Iran war has entered its fifth week, and US gasoline prices have risen to around $4 a gallon. The Fed left short-term interest rates steady recently. Since then, investors' inflation concerns have contributed to a rise in Treasury yields. The Fed may raise rates to get ahead of inflation, but this risks slowing the economy and hurting employment. Alternatively, leaving rates unchanged or cutting them could allow inflation to rise.
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