Fed Hikes Rates by 25 Basis Points as Market Expected

The U.S. Federal Reserve (Fed) raised its policy rate by 25 basis points at the FOMC on the 16th, marking the first time in a year that rates have been hiked since December 2025.

This move was expected by the market, and despite the increase, the S&P 500 has risen about 1% since then. The U.S. Treasury yield has also remained at a favorable level compared to concerns around 5% on the 10-year basis.

The key factors of employment and prices that affect policy interest rates show that U.S. employment last month was 16.2 million, three times more than market expectations, while consumer prices in August were 3.4 percent higher than the target year-on-year.

A 60-year analysis by Groshill Asset Management's CEO Kim Tae-hong shows that stock prices rose eight times six months after the first interest rate hike, and fell five times with a higher percentage of 61%.