Fed Faces Tough Choices as Iran Conflict Fuels Inflation Surge

The Federal Reserve held interest rates steady on Wednesday as the economy weathers resurgent inflation set off by the Iran war.

The policy decision arrived as oil prices surged and stock prices tumbled in response to a resumption of fighting in the Middle East, underscoring the challenge faced by central bankers tasked with containing price increases.

The Federal Open Market Committee (FOMC), a 12-member policymaking body at the Fed, issued a statement describing "elevated" inflation attributed in part to "supply shocks that have driven price increases in certain sectors, including energy."