The Fed Can Only Watch Iran’s Energy Shock and Wait: Bill Dudley

As if tariff chaos, the uncertain impacts of AI and threats to its independence weren’t enough, the US Federal Reserve now faces a new challenge: a potentially epic energy-supply disruption, precipitated by the war in Iran.

What to do? I think the Fed should, and will, take no action until the magnitude and duration of the shock and its effects are clearer — and that will take a considerable amount of time, even acknowledging the current fragile ceasefire.

This energy shock has many aspects that push in different directions. First, its full size and duration remain to be seen. So ...