The Federal Reserve raises interest rates for the first time in three years; the dot plot indicates one more hike this year.

The Federal Reserve implemented its first rate hike in three years on the 17th. Its dot plot median forecast shows that there will be one rate hike this year, with rates remaining unchanged through 2027. The new projections indicate that rates will fall in 2028 and will be maintained between 3.5% and 3.75% in 2029. Previously, in its June forecast, the Fed expected a 25 basis point hike this year and one rate cut in 2027. The Fed also raised its long-term federal funds rate outlook to 3.2%, compared to 3.1% in the June forecast. Of the 19 policymakers, 18 submitted interest rate outlook projections, strongly suggesting that Fed Chair Walsh, as in June, did not provide a specific forecast. The Fed's projections also show that policymakers now expect overall inflation to be higher this year and in the coming years.