The U.S. Federal Reserve has kept interest rates unchanged at 3.5%–3.75%, but signaled rising uncertainty due to global tensions. Fed Chair Jerome Powell warned that the ongoing Iran conflict and surging oil prices could push inflation higher in the near term. While the central bank still expects one possible rate cut this year, policymakers remain divided and cautious on the outlook. Powell emphasized that risks to both growth and inflation remain elevated, making the path ahead uncertain. Markets reacted sharply to the decision, with equities declining, bond yields rising, and the U.S. dollar strengthening on safe-haven demand.