Former U.S. Treasury Secretary Yellen: Iran conflict makes the Federal Reserve more inclined to hold steady

Odaily Planet Daily News: Former U.S. Treasury Secretary Janet Yellen stated that the duration of the impact of the Iran conflict on the oil market will determine how much it will affect U.S. economic growth and inflation pressures, making the Federal Reserve’s job more complicated. Yellen, who previously served as Fed Chair, said during a video conference in Long Beach, California, on Monday, “I think the recent Iran situation makes the Fed more hesitant and less willing to cut interest rates than before.” She pointed out that the current inflation rate is already about one percentage point above the Fed’s target. She noted that President Trump’s tariff policies contributed about half a percentage point to the current 3% inflation rate. Speaking at the S&P Global TPM26 Shipping Industry Conference, she said, “Now we are facing an Iran shock, with oil prices soaring — we don’t know what will happen in the coming days.” Yellen said that if the Strait of Hormuz, a critical passage for oil transportation in the region, remains closed for more than a few days, oil prices could stay high or rise further.