Wall Street Breakfast Powell to stay on amid DOJ probe of Fed
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Mar 18, 2026 Federal Reserve keeps rates unchanged amid uncertainty from Middle East developments. Discussion of the dot plot and a possible rate cut penciled in for later this year. Focus on the Fed chair saying he will remain in position while a DOJ investigation continues. Markets react sharply with stocks down and bond yields climbing.
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Fed Holds Rates With Oil Shock Uncertainty
- The Fed held the policy rate at 3.50–3.75% and left the statement largely unchanged while flagging Middle East uncertainty.
- The dot plot still shows one cut this year and projects 2026 headline and core PCE at 2.7%, above the 2% target.
Powell Calls Dot Plot A Placeholder
- Jerome Powell called the dot plot largely a forced exercise since the Fed lacks a clear read on the oil shock's effects.
- He said it remains unclear whether inflation or labor-market weakness will pose the greater risk going forward.
Powell Commits To Staying Through DOJ Probe
- Powell said he will stay on as Fed chairman until the DOJ investigation is 'well and truly over' and could serve as chairman pro tem if Kevin Warsh's nomination is delayed.
- He also noted he hasn't decided whether to remain a Fed governor afterward.