Persistent inflation above the Fed’s 2% target and a resilient labor market drove the September 2026 25-basis-point hike to the 3.75-4.00% target range, the first increase since 2023. The updated dot plot showed officials shifting hawkish, with a median projecting 4.1% by year-end 2026 and limited easing anticipated into 2027. Market pricing reflects an 85% chance of at least one additional hike by December and potential for further tightening by early 2027 amid sticky core PCE readings near 3%. Key near-term catalysts include the October 28 decision, December 9 projections, upcoming CPI and employment data, and any revisions to the Fed’s inflation or unemployment forecasts that could alter the implied rate path.