Monthly price increases as measured by the Fed’s preferred gauge sped up in February, showing that inflation remained persistent even before the Iran war began last month.

Americans kept spending in February even as prices rose, with the Iran war expected to push costs higher, new data showed Thursday.

An energy shock stemming from the fighting has added a layer of complexity to the Federal Reserve’s decision-making around interest rates.

Federal Reserve policymakers may ​consider cutting interest rates later this year now that an agreement for a two-week ceasefire in the ‌Iran conflict has eased concerns about a resurgence of inflation,

A growing number of Federal Reserve officials worried the Iran war could further stoke inflation and wanted to make clear following their March meeting that the central bank may have to consider raising interest rates.

Fed-funds futures traders are now pricing in a 44.1% chance that the Federal Reserve will cut its key interest rate at least once by year-end, according to CME FedWatch data. That is up from a 14.1% likelihood a day ago.

Federal Reserve Chair Jerome Powell said during a recent event at Harvard University that the central bank can look past the initial shock from the war with Iran, but might have to act if price increases start to shift consumer

The market's expectations for a rate cut in 2026 doubled after the US and Iran agreed to a two week ceasefire deal.