The post-2008, pre-pandemic era of low rates, low inflation, and ever-expanding values is firmly in the rearview mirror. The term used by one regional Fed president for what we're seeing now is "high-pressure equilibrium," where low unemployment and positive growth co-exist in tension with inflation that is above the Fed’s long-term target of approximately 2%.

For most of the summer, increasingly positive data releases fed into the market’s upbeat view of the economy. August challenged the market’s optimism.

The doom-and-gloom scenario of an all-but-inevitable recession seemed to be replaced by something that looked like optimism around the prospect of a soft landing.

The Fed finally hit "pause" on interest rate increases in June after fifteen months and ten consecutive rate hikes, and it’s become clear that it is only a brief pause.

Throughout the month, the markets focused on the debt ceiling negotiations and the likely impact to government spending – or at least the increased uncertainty around what spending would be. At the end of the month, the FOMC minutes from the early May meeting were released.

The biggest news in the Fed’s statement after their meeting on May 3 was what it didn’t say.