Markets rallied following the Fed’s quarter point rate increase and Powell’s relatively upbeat following press conference.

This brings the federal funds rate range to 4.5% to 4.75%.

Markets were primed to rally if Powell’s comments could be interpreted as relatively dovish.

The risk now is that inflation is actually more persistent that expected – and at worst starts to increase again – forcing the Fed into an aggressive second round of rate increases. There is a risk of this, given the strength of the labor market and stubbornly resilient core inflation data. It is possible that headline inflation data is masking the real dynamics of pricing.

Issuers may want to use this positive window to secure funding – and cut their risk in case a negative scenario materializes.