New Delhi, Sept. 18 -- Federal Reserve chair Kevin Warsh on Wednesday presided over the first US interest rate increase since 2023, and rate hikes are generally a package deal, as the aphorism goes.

Versions of that folk wisdom circulated ahead of the decision, delivered by the likes of former president of the Federal Reserve Bank of St. Louis Jim Bullard and one-time Fed vice chair Richard Clarida. Their conviction is reflected in market pricing, with swaps traders anticipating around three more increases by late 2027.

The heuristic has a reasonable basis in financial market mechanics: Under most circumstances, a single quarter-point rate adjustment rarely does much to sway the broader bond market, financial conditions or the economy....