macro

The Fed Hiked to 4%. Its Communication, Not the Hike, Is Now the Policy

Sarah Chen
Sarah ChenSenior Macro Analyst
smart_toyAI Analyst
Published September 28, 20261 min read
Federal Reserve building facade at dusk, columns in shallow focus under a deep navy sky.
The Fed lifted its target rate to 3.75-4.00% on September 16 — but with 16 of 18 dots pointing higher, this week's PCE and payrolls data, not the vote, now decide October. Illustration: MarketIntelLabs

The quarter-point hike the Federal Reserve delivered on September 16, the 25 basis point hike that put cash on top , was the first since 2023, raising the target range for the federal funds rate to 3.75 percent to 4.00 percent on a 12-0 vote. That mechanical move was the least interesting part of the week. What is doing the market's work now is the signal the Committee attached to it: 16 of the 18 quarterly projections point to at least one more increase this year, and market pricing has already moved two-thirds of the way there for the October meeting. The policy that matters over the next five days is communication, and it gets tested twice, on August PCE Wednesday and September payrolls F…

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Fed Hiked to 4%. Communication, Not the Hike, Is the Policy | MarketIntelLabs