---
source: Federal Reserve
url: https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20260318.pdf
document_type: pdf
date_retrieved: 2026-03-21
period: March 2026
parent_publication: FOMC Press Conference Transcript
indicators_covered: [Interest Rate, Inflation, Unemployment Rate, GDP, PCE]
---

# Transcript of Chair Powell’s Press Conference, March 18, 2026

**Note:** The payload indicated a speech on March 21, 2026. Official Federal Reserve records and real-time search confirm the most recent and relevant official publication by Chair Powell is the FOMC Press Conference transcript from March 18, 2026. This document contains the definitive outlook on interest rates and the U.S. economy for the current period.

## Policy Decision and Outlook
The FOMC decided to leave the policy rate unchanged at **3-1/2 to 3-3/4 percent**. Chair Powell characterized this stance as "appropriate to promote progress toward our maximum employment and 2 percent inflation goals."

## Economic Projections (Summary of Economic Projections - SEP)
- **Real GDP:** Median projection of **2.4 percent** for 2026 and **2.3 percent** for 2027.
- **Unemployment Rate:** 4.4 percent in February; median projection remains at **4.4 percent** for the end of 2026.
- **Inflation (PCE):** Estimated at **2.8 percent** (headline) and **3.0 percent** (core) for the 12 months ending in February. Median SEP projection for total PCE is **2.7 percent** in 2026 and **2.2 percent** in 2027.
- **Federal Funds Rate:** Median projection of **3.4 percent** at end of 2026 and **3.1 percent** at end of 2027.

## Key Themes and Nuance

### Inflation and Middle East Supply Shocks
Powell noted that "higher energy prices will push up overall inflation" due to supply disruptions in the Middle East. Gasoline prices are up nearly $1.00/gallon. However, he emphasized that standard practice is to "look through" energy shocks, provided inflation expectations remain anchored at 2%.

### Tariffs and Goods Inflation
A significant portion of current core inflation (estimated between 0.5% and 0.75%) is attributed to the effects of **tariffs**. Powell expects progress on inflation to manifest as these one-time price effects "go through the system" by mid-2026.

### Labor Market Dynamics
Powell described a "zero employment growth equilibrium." Job gains have been low, partly due to declining labor force growth (lower immigration and participation). He noted downside risks to the labor market but balanced these against upside inflation risks.

### "Stagflation" vs. "Tension"
Powell explicitly rejected the term "stagflation," reserving it for 1970s-style conditions (double-digit unemployment). He characterized the current environment as "some tension between the goals" of maximum employment and price stability.

### Productivity and AI
The long-run growth estimate was revised up to **2.0 percent**, driven by "meaningfully higher productivity." While not yet attributing this to generative AI, Powell noted that data center construction is currently pushing inflation *up* at the margin, though AI could expand potential output over time.

### Successor and Investigations
Powell confirmed that if a successor is not confirmed by May 15, he will serve as "chair pro tem." He stated he has "no intention of leaving the Board until the investigation is well and truly over, with transparency and finality."

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## Content Verification
- **Indicator Present:** Interest Rate (3-1/2 to 3-3/4 percent), PCE inflation (2.8%), Unemployment (4.4%).
- **Title Match:** Transcript of Chair Powell’s Press Conference, March 18, 2026.
- **Source:** Federal Reserve Board of Governors.