On Wednesday, March 18, 2026 FOMC Chair Jerome Powell gave his scheduled March 2026 FOMC Press Conference. (link of video and related materials)
Below are Jerome Powell’s comments I found most notable – although I don’t necessarily agree with them – in the order they appear in the transcript. These comments are excerpted from the “Transcript of Chair Powell’s Press Conference“ (preliminary)(pdf) of March 18, 2026, with the accompanying “FOMC Statement” and “Summary of Economic Projections” (pdf) dated March 18, 2026.
Excerpts from Chair Powell’s opening comments:
Today the FOMC decided to leave our policy rate unchanged. We see the current stance of monetary policy as appropriate to promote progress toward our maximum employment and 2 percent inflation goals. The implications of developments in the Middle East for the U.S. economy are uncertain. We will remain attentive to risks to both sides of our dual mandate. I will have more to say about monetary policy after briefly reviewing economic developments.
also:
Our monetary policy actions are guided by our dual mandate to promote maximum employment and stable prices for the American people. At today’s meeting, the Committee decided to maintain the target range for the federal funds rate at 3-1/2 to 3-3/4 percent.
From last September through December, we lowered our policy rate 3/4 percentage point, bringing it within a range of plausible estimates of neutral. This normalization of our policy stance should continue to help stabilize the labor market while allowing inflation to resume its downward trend toward 2 percent.
Excerpts of Jerome Powell’s responses as indicated to various questions:
COLBY SMITH. Thank you, Colby Smith with the New York Times. There’s been some debate about whether the Fed should look through the inflation that will come from higher oil prices stemming from the Middle East conflict. Is that the right approach at this juncture, and to what extent does the fact that inflation has been above target for roughly five years now influence the Committee’s thinking around this?
CHAIR POWELL. So, first let me say, we’re well aware of the performance of inflation over the last few years and how a series of shocks have interrupted progress that we’ve made over time. And that happened most recently with tariffs, and then — and now there will be some effects on inflation going forward. The — the thing that’s really important that we see this year is progress on inflation through a reduction in goods inflation, as the one-time effects on prices of tariffs go through the system, go through the economy. That’s the main thing we’re looking for going into this exercise. And we need to be seeing that to, you know, to sort of understand we actually are making progress. Because on net, we didn’t make progress. And if you look at total inflation, sorry, total core inflation, it’s about 3 percent, and some big chunk of that, between a half and three-quarters is actually tariffs, so we’re looking for progress on that. The question of whether we look through the energy inflation doesn’t really arise until we have kind of checked that box. And of course is kind of standard learning that you look through energy shocks, but that’s always been dependent on inflation expectations remaining well anchored, and I think now it’s also dependent now on what you mentioned, which is that broader context of five years now of inflation above target. We have to keep all of those things in mind, and the question of looking through when it does arise will be one to approach not lightly, but you know, in the context that you mentioned.
COLBY SMITH. And just on the SEP, can you help us make sense of why there is still a bias to cut for most officials this year, despite the upward revision to headline and core inflation, and the essentially unchanged forecast for growth in unemployment? Just curious kind of what — what’s the genesis behind the need — what’s the need for the cut?
CHAIR POWELL. Yeah, so there are 19 people and so 19 reasons, 19 individual submissions. But, and if you notice, the median didn’t change, but there was actually some movement toward — a meaningful amount of movement toward — toward fewer cuts by people. So four or five people went from two to one, let’s say. Two cuts to one cut. And each person has individual stories behind what they want to do. But essentially it is that the forecast is that we’ll be making progress on inflation. Not as much as we had hoped, but some progress on inflation. It should come as we start to see in the middle of the year, progress on tariffs going through once and then tariff inflation coming down. That’s — we should be seeing that. And the rate forecast is conditional on the performance of the economy. So if we don’t see that progress, then you won’t see a rate cut.
also:
COURTENAY BROWN. Hi Chair Powell. Thanks for taking our questions. What makes
you so certain that tariff-related price increases will be a one-time effect? I don’t think we’ve seen you since the Supreme Court tariff decision. And it’s pretty clear that none of us know what the extent of the tariff shock will be as the administration moves to replace some of the tariffs that were overturned. So I suppose I’m curious what would make you question this certainty that tariffs are going to be a one-time price effect?
CHAIR POWELL. Well, I — I would not at all use the word certain about my views on that. I’m not certain, I’m uncertain. But just, if you think about what it is, it’s a one-time increase in the price of a good. Right? And what inflation is, is ongoing increases in prices this year, next year, the year after. That’s what inflation is. It’s not a one-time price increase. There’s a very, very big difference, the public doesn’t really focus on that. But that’s what — that’s the difference. And tariffs should be, in theory, unless they cause people to start expecting still more tariffs the next year, and still more tariffs the next year, they should be a classic one-time thing. People say the same thing, traditionally, about an energy price spike. Because traditionally, prices go up and they come back down. And by the time monetary policy would react, it would be over. So, I don’t have tons of confidence on that. I mean I think the theory is probably right, but as usual, the time it takes to get all the way through the economy is just very uncertain. And you know, we found that coming out of COVID that the inflation did go away, and largely for the reasons we thought it would. But it took two years longer than we thought. And so I think we have to be humble about knowing how long it will take for tariffs to go all the way through the economy. And so what we’ve been doing is, or our staff’s been doing, it’s very interesting, they started off with just an estimate. Because there wasn’t a real history. And then they built, based on the history that they’re seeing of tariffs coming through into prices, they’ve now — they can now have an arc and for all the tariffs they can say, well — so we have I think slightly more confidence that we will see tariff inflation coming down. Not prices, but you won’t see further increases, and we should start seeing that more and more in the middle parts of the year. We do expect that. Now you’re also right though, that the level of tariffs came down fairly meaningfully in the wake of the — in the wake of the court decision, but the administration said they’re going to move the — they’re going to get that rate right back up to where it was. So, and we — we assume they’ll do that over time. So, that’s how we think about it.
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The Special Note summarizes my overall thoughts about our economic situation
SPX at 6628.92 as this post is written
