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Fed holds rates—is this it?

At its September meeting, the U.S. Federal Reserve (Fed), as expected, left its federal funds target rate unchanged, at 5.25%–5.50%. The outlook remains hawkish, though, and the interest rate market currently is pricing a 30% probability of an additional 25-basis-point (bp; 100 bps equal 1.00%) hike at the Fed’s November meeting. Despite core inflation’s continued slowing, its current 4.3% year-over-year pace seems too high to us to expect interest rate cuts anytime soon.

U.S. Jobs Report: Stronger Than the Investment Outlook

Aligning with the U.S. Labor Day holiday, Matthias Scheiber, head of Allspring’s Systematic Edge Multi-Asset team, and Travis Keshemberg, senior portfolio manager on the Systematic Edge Multi-Asset team, review the U.S. employment situation and discuss the potential opportunities and challenges in the next 6 to 12 months.

Is this the final Fed hike, for now?

As expected, the Federal Open Market Committee (FOMC) decided to hike its key interest rate, the federal funds rate, by 25 basis points (bps; 100 bps equal 1.00%), to a range of 5.00% to 5.25%. Despite the banking sector’s ongoing wobbles—most recently, First Republic Bank’s takeover by JP Morgan over the past weekend—the FOMC sees fighting inflation as its highest priority.