Fed Holds Interest Rates Steady Amid Inflation Concerns and Escalating US-Iran Tensions
The Federal Reserve kept benchmark interest rates steady for a fifth consecutive session in Fed Chair Kevin Warsh's second policy decision, which passed by a 9-3 vote with three policymakers favoring a quarter-point hike. The central bank cited elevated inflation partly due to energy pressures linked to the Iran conflict and reaffirmed their commitment to price stability.
The move stoked inflation concerns despite quarterly results from Microsoft, Meta, and Qualcomm weighing on markets. Microsoft's fourth-quarter earnings soared past expectations with strong cloud revenues, pushing the stock more than 7% higher overnight. However, both Meta and Qualcomm failed to impress investors with their prints, sending the stocks down nearly 7% and over 3% lower.
On the geopolitical front, conflict between the U.S. and Iran escalated again after the latter launched a surprise attack on U.S. military troops in the Middle East. The U.S. said it had retaliated to the attacks, with global oil prices mixed at the time of writing.