The Federal Reserve raised rates by 75 basis points for the fourth consecutive time to bring the fed funds rate to a range between 3.75% and 4%. This is now the highest level of rates since January 2008 as the central bank continues to battle inflation.

There were some hints that the Fed is open to slowing its pace of hikes in upcoming meetings, but this is contingent on positive developments on the inflation front. This led to a brief rally on Wall Street with stocks recovering their losses and trading higher by more than 1%. But, these gains quickly evaporated during the press conference as Chair Powell made clear that rate hikes would continue even if it was at a slower pace.

He took pains to emphasize that the Fed has no intention of pausing soon. However, he said there would be a discussion about slowing the pace of hikes. And, he underscored that it will take patience and resolve to achieve their inflation target.

Another bearish catalyst for the stock market was that Chair Powell sees the odds of a 'soft-landing' becoming less likely. This is because he sees a higher endpoint for rate hikes than at the previous September FOMC meeting. Although, he said that it's still possible but becomes harder to achieve the higher the terminal rate.

Inflation is trending at a 40-year high. Around September, there were some signs that labor markets were showing signs of strain with unemployment claims rising, but it's essentially re-tightened with 2 openings for every unemployed worker, leading to higher wages.

Currently, core inflation is up 6.2% which is the highest since the 1980s. There's been relief in many categories, but these have been offset by gains in other 'stickier' categories. It's also been remarkably resilient despite the Fed's rate hikes leading to much lower activity in the financial, housing, and real estate sectors.

For the December meeting, futures markets indicate a 50% chance of a 50 basis point hike and a 50% chance of another 75 basis point move. Major factors impacting these decisions are likely to be the October jobs report and CPI.