The longer the Iran war goes on, the greater the impact on inflation, the US central bank warns

The waterway, a key corridor for roughly a fifth of global oil and gas flows, has seen severe disruption during the war, driving up energy costs worldwide. The conflict, which began after US President Donald Trump and Israel launched strikes on Iran on 28 February, has already pushed global energy prices higher, adding pressure to an already fragile inflation outlook in the United States. Kashkari said the uncertainty surrounding the war complicates the central bank’s response and could force policymakers to tighten monetary policy. “I don't feel comfortable signaling that a rate cut is in the cards. You know, we might be in worse scenarios, we might have to go the other direction,” he said. Kashkari also broke with the majority at the latest Federal Open Market Committee meeting, joining a larger-than-usual group of dissenters who opposed the wording of the Fed’s policy statement.