Fed Policy and Inflation Tug-of-War

The Fed has delivered the anticipated 25-basis-point hike, but officials signal that further tightening may be needed. Elevated 3.4% inflation, a higher PCE projection, firm employment, resilient consumer data, and roughly 100 basis points of market-priced future tightening keep restrictive policy and higher yields as major SPY risks; post-meeting guidance and retail sales remain key tests.