Fed Hikes as Sticky Inflation Drives Higher-for-Longer Signal

The Fed delivered a unanimous 25bp hike on September 16 to 3.75%-4.00%, raised inflation projections, and signaled another hike in 2026 as growth and employment remained firm. Markets now focus on Warsh's guidance, upcoming PCE and labor data, and whether energy inflation becomes persistent; political pressure on Fed officials remains an institutional-credibility risk.