📈 The first rate hike in three years — and how markets assessed it

+25 bps to 3.75–4.00% · Probability of another hike in October — 53%
① What happened: The Fed raised the federal funds rate by 25 bps to 3.75–4.00%. The decision was unanimous — 12:0. This was the first hike since July 2023 and the first rate change in 2026.
② The main signal — the Dot Plot: The median forecast for the rate at the end of 2026 was raised from 3.75% to 4.10%. Twelve officials expect another hike, 4 expect two hikes, and only 2 do not expect further hikes.
③ Warsh’s signal did not bring relief to the market: he did not express confidence that inflation is moving toward the target, did not provide clear forward guidance, and did not confirm the December decision: “If inflation does not decline quickly enough, we are prepared to act again.”

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