Fed Raises Rates: Inflation and Labor Market Forecasts

The US Federal Reserve unanimously supported raising the key rate in September at its last meeting. Most participants believe that one more increase will be needed by the end of 2026.

Inflationary risks remain tilted upward, reinforced by strong demand and new price shocks. The hike is viewed as a precautionary measure to prevent high prices from becoming entrenched in the economy.

Artificial intelligence has a significant impact on macroeconomic indicators. The scale of AI infrastructure construction exceeds expectations, which could lead to demand outstripping supply and intensify inflationary pressure.

• The labor market remains stable, with downside risks considered balanced
• The outlook for economic growth and the labor market has improved compared to July
• Financial conditions are assessed as accommodative despite rising long-term bond yields

The central bank discussed the need to prepare response tools for potential stress in the Treasury market. Currently, the market is operating without serious disruptions, but precautionary measures remain relevant.