Fed Hikes to 3.75%-4.0%, Dow Sheds 600 Points on Warsh Warning

The Federal Reserve's first rate hike in three years lifted the benchmark to a 3.75%-4.0% range, with the committee unanimous on the move itself but split on forward guidance. That ambiguity, paired with Chair Kevin Warsh's hawkish tone on inflation, triggered a 600-point Dow selloff rather than the relief rally some had priced in.

Industry desks are now repricing volatility expectations across equities and fixed income, with strategists flagging further sharp swings as the base case into year-end. The divergence between a decisive vote and mixed guidance is being read as a signal that policy uncertainty, not just rate levels, will drive positioning.