The Fed Just Raised Rates for the First Time in Three Years. History Says This Is What Comes Next.
How does the market typically perform after a new rate hike cycle begins?
Overview
The Federal Reserve raised interest rates rapidly in 2022 and 2023 in response to inflation rising to a multi-decade high. And ever since then, investors have mainly wondered how quickly rates would fall, and when we entered 2026, most didn't feel that the rate cuts were done yet.
However, after a significant increase in inflation this year, the Fed reversed course and tightened monetary policy. On Sept. 16, the Fed announced its first rate hike in three years, a 25-basis-point increase to a federal funds rate target range of 3.75%-4%. The move was small, but it marks the official start of a tightening cycle.
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Details
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Originally published at www.fool.com.