The U.S. Federal Reserve raised its benchmark interest rate by 0.25 percentage points to a range of 3.75% to 4.00% on September 16, its first increase in three years and two months since July 2023. The decision was presented as a preemptive response to persistent inflation, with the personal consumption expenditures index rising 3.7% year-on-year in July, well above the Fed’s 2% annual target. Wall Street analysts cite resilient U.S. demand, Middle East oil-supply disruptions and AI-related data-center investment in materials such as copper as key inflation drivers. Richmond Federal Reserve Bank president Tom Barkin said the Fed remains open to further increases. Goldman Sachs now expects another 0.25 percentage point hike in October, while other strategists anticipate two or three additional increases by early next year. Forecasts for the S&P 500 have been cut by Ed Yardeni and Savita Subramanian, although Subramanian said lower prices could attract investors waiting to enter the market. Jordan Jackson advised shifting between growth and value stocks, favoring large-cap companies and businesses positioned to benefit from AI infrastructure spending. Experts also urged elderly retirees to move some stock holdings into bank deposits, favor newer high-coupon bonds, reduce credit-card debt and prepare for higher mortgage costs. They cautioned that deposit rates may adjust slowly: after the first post-pandemic hike in March 2022, average savings rates rose only 0.08 percentage points over six weeks.