Entering the meeting, markets are pricing two interest rate cuts from the Fed in 2025, in line with the central bank's median dot plot projection from March. But since then, there have been significant changes to tariff policy, which will put any updates to the Fed's outlook in particular focus.

If prices go up, Fed officials may be inclined to raise its benchmark rate, raising borrowing costs for businesses and consumers. That could lead to businesses to cut jobs, particularly in the high-growth tech sector, and force Americans to pull back on spending, which drives more than 70% of economic activity in the U.S.

The country’s exports mostly come from Kharg Island in the Persian Gulf. But Israel’s energy facilities are also at risk.

U.S. ultra-low sulfur diesel futures hit the highest level since February, outpacing gains in oil and gasoline as analysts warned that diesel supply is the most exposed to the conflict in the Middle East.

Israel’s attack on Iran has catapulted their long-running conflict into what could become a wider, more dangerous regional war and potentially drive prices higher for both businesses and households

President Donald Trump has repeatedly demanded the Federal Reserve slash interest rates. But Fed officials have stood pat, waiting to see how his administration’s sweeping policy changes affect the economy first.

The Indian rupee is expected to slip past 86 to the U.S. dollar at the open on Friday, hit by surging oil prices and sliding risk assets after Israel attacked targets in Iran.

Although the U.S. is a net oil exporter, higher oil prices could increase inflation and lower economic growth.

The US ordered some staff to leave its embassy in Baghdad, and restricted government employees and family members in Israel from traveling outside major cities like Tel Aviv. Around the same time, risk warnings from naval forces were issued to vessels operating in and around the Persian Gulf,