The Federal Reserve completed its first rate hike since 2023 and sent a signal that it is ready to take further steps to curb inflation in the US. Federal Reserve Chairman Kevin Walsh has withstood Donald Trump's pressure to keep interest rates low. Subadra Rajapa, head of US research at Société Générale, said: “This resolution, along with the overall hawkish tone of the press conference... the focus is highly focused on inflation. I think the Federal Reserve is gradually withdrawing from the easing policy.” Investors are also concerned about Walsh's optimistic judgment on the US economy and labor market, which further sends a signal that the Federal Reserve is willing to introduce more policies to curb inflation. But the Federal Reserve's forecast also highlights the challenge: officials expect inflation to reach the 2% target until 2029. Investors said that the hawkish resolution fixed Walsh's credibility in fighting inflation and swept away market concerns about the lack of strength of his policies after the July interest rate meeting. Priya Misra, portfolio manager at J.P. Morgan Asset Management, said, “Today, we finally don't have to worry about the independence of the Federal Reserve and the credibility of its policies. We can turn this page over.”

The Federal Reserve completed its first rate hike since 2023 and sent a signal that it is ready to take further steps to curb inflation in the US. Federal Reserve Chairman Kevin Walsh has withstood Donald Trump's pressure to keep interest rates low. Subadra Rajapa, head of US research at Société Générale, said: “This resolution, along with the overall hawkish tone of the press conference... the focus is highly focused on inflation. I think the Federal Reserve is gradually withdrawing from the easing policy.” Investors are also concerned about Walsh's optimistic judgment on the US economy and labor market, which further sends a signal that the Federal Reserve is willing to introduce more policies to curb inflation. But the Federal Reserve's forecast also highlights the challenge: officials expect inflation to reach the 2% target until 2029. Investors said that the hawkish resolution fixed Walsh's credibility in fighting inflation and swept away market concerns about the lack of strength of his policies after the July interest rate meeting. Priya Misra, portfolio manager at J.P. Morgan Asset Management, said, “Today, we finally don't have to worry about the independence of the Federal Reserve and the credibility of its policies. We can turn this page over.”