The Federal Open Market Committee’s September 2026 decision to raise the federal funds target range 25 basis points to 3.75–4.00 percent, with minutes showing broad support for at least one additional hike by year-end, forms the core driver of current trader positioning on the highest rate reached before 2027. Elevated inflation readings, including August CPI at 3.4 percent and core at 2.4 percent, alongside a resilient labor market with unemployment near 4.2 percent, have reinforced the hawkish tilt in the dot plot, which now points to a median near 4.1 percent through 2027. Markets are pricing roughly an 85 percent chance of at least one more increase by the December meeting, while the October 27–28 gathering and upcoming data releases will test whether the path peaks at 4.25 percent or higher before any 2027 easing.