Fed Hikes Rates Amid Expectations for Further Increases

The Federal Reserve raised its federal funds policy rate by 25 basis points to a range between 3.75% and 4%, signaling further increases in the near future.

The FOMC's interest rate forecast, or dot plot, suggests that the central bank will hike rates by an additional 25 basis points by the end of this year, with at least eight members expecting a further increase to 4.5% next year.

This would be a significant jump from the current rate, pushing it above both the RSM estimate and the Federal Reserve's own estimate for the terminal rate.