The Federal Reserve is poised to keep interest rates unchanged this week, as conflict between Israel and Iran add further uncertainty to the US and global economic outlook.
Fed officials in recent months have acknowledged that risks to both inflation and unemployment are rising as a result of President Donald Trump's tariff agenda.
The three days of tit-for-tat missiles drone strikes on defence and energy infrastructure of Israel and Iran that have pushed oil prices higher also increase the probability that inflation will surge again in the US.
Brent crude, the benchmark for two thirds of the global oil, and West Texas Intermediate, which measures US crude, settled around $74 a barrel after rising more than 13 per cent in the hours following the air strikes on Friday.
“I think, if anything, inflation is going to tick a little bit higher, because oil prices are going to be a little bit higher in the near-term,” said Jay Zagorsky, a professor at the Questrom School of Business at Boston University.
“If I was sitting there in that room … I would say I'm a little concerned about inflation.”
The worsening geopolitical situations in the Middle East also stoke fears that conflict could disrupt trade in the Strait of Hormuz, through which one-fifth of the world's oil passes each day. Significant disruptions could lead to higher energy prices and shipping costs.
“This situation really brings us back to the age old question of risks to oil and gas flows through the Strait of Hormuz,” Colby Connelly, a senior fellow at the Middle East Institute said during a panel discussion on Friday.
“Right now, things in the strait are normal. Vessels are coming and going. There's no sign of any disruption yet, and prices have responded to this risk,” he said.
The tensions add to an already heightened degree of uncertainty facing a US central bank that has opted to remain cautious to offset the potential effects of tariffs on the world's largest economy.
Fed cautious despite tame data
Little has changed in the US economic picture since the Fed last met six weeks ago, and Mr Trump's changing trade policy has offered no clarity either.
Recent data has shown inflation has come in tamer than anticipated, as economists still anticipate a bump in prices because of tariffs. Meanwhile, May's employment data showed that hiring has slowed, which could point towards a resumption in rate cuts.
But inflation still remains above the Fed's 2 per cent goal, and tariff-related issues have not yet been resolved.
“Stay put until something dramatic happens in the economy. Right now, I'm not seeing anything dramatic happening in the US,” Mr Zagorsky said.
Mr Trump has delayed universal tariffs that could lead to a scenario of low growth and high inflation, while also increasing tariffs on steel and aluminium imports to 50 per cent. He announced a trade deal with the UK, while a tariff truce with China eased some of the sky-high levies Washington and Beijing had imposed on each other.
Given this uncertainty, Federal Reserve chairman Jerome Powell and other officials have suggested it could take months before they receive enough clarity to cut rates again.
The Fed has held interest rates at roughly 4.33 per cent since last cutting them in December.
“They're in this environment of substantial uncertainty,” said David Wilcox, senior fellow at the Peterson Institute for International Economics and director of US economic research at Bloomberg Economics.
“It isn't very long ago that we had the Covid-related surge [in inflation] to the worst levels in 40 years. So, they'll put enormous emphasis on ensuring that that doesn't happen,” he said.
Updated projections in focus
With the Fed widely expected to keep rates on hold, attention will shift to the central bank's economic projections. The Fed updates its forecasts for interest rates, inflation, the unemployment rate and gross domestic product every quarter.
In March, Fed officials expected two quarter-point cuts this year, with the unemployment slightly rising to 4.4 per cent and their preferred inflation gauge ticking up to 2.7 per cent.
Minutes released from the March meeting showed officials “judged that inflation was likely to be boosted this year by the effects of higher tariffs”.
Traders currently anticipate the Fed will not resume cutting rates until September, before cutting them by a second quarter-point in December, according to CME Group data.
“My guess is that they'll pare that back to just one rate cut this year. And although they don't have to specify when it comes, my guess is that that will come quite late in the year,” Mr Wilcox said.
The Fed could also adjust its forecast for gross domestic product. Fed officials in March anticipated the economy would grow by 1.7 per cent this year.
The World Bank last week, however, slashed its growth forecast for the US in 2025 to 1.4 per cent
“The rise in trade barriers, heightened uncertainty, and the spike in financial market volatility are set to weigh on private consumption, international trade, and investment,” the World Bank said.
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
The candidates
Dr Ayham Ammora, scientist and business executive
Ali Azeem, business leader
Tony Booth, professor of education
Lord Browne, former BP chief executive
Dr Mohamed El-Erian, economist
Professor Wyn Evans, astrophysicist
Dr Mark Mann, scientist
Gina MIller, anti-Brexit campaigner
Lord Smith, former Cabinet minister
Sandi Toksvig, broadcaster
How the bonus system works
The two riders are among several riders in the UAE to receive the top payment of £10,000 under the Thank You Fund of £16 million (Dh80m), which was announced in conjunction with Deliveroo's £8 billion (Dh40bn) stock market listing earlier this year.
The £10,000 (Dh50,000) payment is made to those riders who have completed the highest number of orders in each market.
There are also riders who will receive payments of £1,000 (Dh5,000) and £500 (Dh2,500).
All riders who have worked with Deliveroo for at least one year and completed 2,000 orders will receive £200 (Dh1,000), the company said when it announced the scheme.
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
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The President's Cake
Director: Hasan Hadi
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UAE currency: the story behind the money in your pockets
The five pillars of Islam
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Tamkeen's offering
- Option 1: 70% in year 1, 50% in year 2, 30% in year 3
- Option 2: 50% across three years
- Option 3: 30% across five years
Mohammed bin Zayed Majlis
Summer special
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3/5 stars
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Anghami
Started: December 2011
Co-founders: Elie Habib, Eddy Maroun
Based: Beirut and Dubai
Sector: Entertainment
Size: 85 employees
Stage: Series C
Investors: MEVP, du, Mobily, MBC, Samena Capital
The specs
Engine: 1.6-litre 4-cyl turbo
Power: 217hp at 5,750rpm
Torque: 300Nm at 1,900rpm
Transmission: eight-speed auto
Price: from Dh130,000
On sale: now
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
10 tips for entry-level job seekers
- Have an up-to-date, professional LinkedIn profile. If you don’t have a LinkedIn account, set one up today. Avoid poor-quality profile pictures with distracting backgrounds. Include a professional summary and begin to grow your network.
- Keep track of the job trends in your sector through the news. Apply for job alerts at your dream organisations and the types of jobs you want – LinkedIn uses AI to share similar relevant jobs based on your selections.
- Double check that you’ve highlighted relevant skills on your resume and LinkedIn profile.
- For most entry-level jobs, your resume will first be filtered by an applicant tracking system for keywords. Look closely at the description of the job you are applying for and mirror the language as much as possible (while being honest and accurate about your skills and experience).
- Keep your CV professional and in a simple format – make sure you tailor your cover letter and application to the company and role.
- Go online and look for details on job specifications for your target position. Make a list of skills required and set yourself some learning goals to tick off all the necessary skills one by one.
- Don’t be afraid to reach outside your immediate friends and family to other acquaintances and let them know you are looking for new opportunities.
- Make sure you’ve set your LinkedIn profile to signal that you are “open to opportunities”. Also be sure to use LinkedIn to search for people who are still actively hiring by searching for those that have the headline “I’m hiring” or “We’re hiring” in their profile.
- Prepare for online interviews using mock interview tools. Even before landing interviews, it can be useful to start practising.
- Be professional and patient. Always be professional with whoever you are interacting with throughout your search process, this will be remembered. You need to be patient, dedicated and not give up on your search. Candidates need to make sure they are following up appropriately for roles they have applied.
Arda Atalay, head of Mena private sector at LinkedIn Talent Solutions, Rudy Bier, managing partner of Kinetic Business Solutions and Ben Kinerman Daltrey, co-founder of KinFitz
In-demand jobs and monthly salaries
- Technology expert in robotics and automation: Dh20,000 to Dh40,000
- Energy engineer: Dh25,000 to Dh30,000
- Production engineer: Dh30,000 to Dh40,000
- Data-driven supply chain management professional: Dh30,000 to Dh50,000
- HR leader: Dh40,000 to Dh60,000
- Engineering leader: Dh30,000 to Dh55,000
- Project manager: Dh55,000 to Dh65,000
- Senior reservoir engineer: Dh40,000 to Dh55,000
- Senior drilling engineer: Dh38,000 to Dh46,000
- Senior process engineer: Dh28,000 to Dh38,000
- Senior maintenance engineer: Dh22,000 to Dh34,000
- Field engineer: Dh6,500 to Dh7,500
- Field supervisor: Dh9,000 to Dh12,000
- Field operator: Dh5,000 to Dh7,000
