Steelman · slot A
The Fed has no room to cut
A Federal Reserve policymaker would argue —We came into this year with inflation still above target and a labor market that hadn't fully cooled. Now the Strait of Hormuz — a fifth of global oil and gas flows — is disrupted, and that supply shock is moving through energy prices into core goods and services. In that environment, signaling a rate cut would be reckless: it would loosen financial conditions exactly as imported inflation accelerates, and it would erode the credibility we spent years rebuilding. I dissented at the last FOMC because the statement understated this risk. The honest answer to markets is that the next move could be a hike, not a cut, and the longer this war runs, the more that becomes the base case rather than the tail.