Fed Chair Powell says central bank can wait on rate hikes despite oil price spike

Federal Reserve Chair Jerome Powell said the central bank can afford to 'wait and see' how the conflict in the Middle East affects inflation before deciding on further interest rate moves. He noted that while the war has pushed up energy prices, longer-term inflation expectations remain stable, and the Fed's tools are limited in directly combating an oil price shock.

Powell warned, however, that the Fed's patience has limits and it is closely monitoring the situation. His comments align with signals from other central bankers, like Brazil's Gabriel Galípolo, who have also indicated that interest rate hikes are an ineffective tool against supply-driven oil price shocks.