September 18, 2026
The Fed delivered its first rate hike since 2023 — a unanimous 25-basis-point move to 3.75–4% — and markets chose to take it as a confidence signal, not a threat. The TSX jumped 1.08%, Wall Street posted its best day since August, oil pulled back for a second session, and the Bank of England held at 3.75%. Here's what happened, and what it means for your wallet.
🇨🇦 Canada — TSX
Thursday's session was a sharp reversal for the TSX. Canada's main index closed up 1.08%, with Materials, Utilities, and Clean Technology leading the advance. Miners were the standout performers — Americas Silver Corp surged 10.61%, Discovery Mining added 9.95%, and Silvercorp Metals rose 9.03% — as gold bounced and copper held gains on stronger China data. On the downside, Restaurant Brands International fell 2.28% and Rogers Communications dropped 2.21%, the latter still weighed by concerns about rate-hike pressure on consumer spending.
Decliners were outnumbered by advancers 649 to 291. The S&P/TSX 60 VIX fell 4.31% to 13.78, signalling reduced near-term anxiety.
| Index | Close (Thu Sep 17) | Change | Change % |
|---|
| S&P/TSX Composite | 35,874 | +383 | +1.08% |
| Previous close (Wed Sep 16) | 35,491 | — | — |
| 52-week high | 37,069 (Aug 26) | — | — |
🇺🇸 United States
It was Wall Street's best session since August. The S&P 500 gained 1.14% and the Nasdaq 100 climbed 1.73%, led by semiconductors and memory — Intel surged 7.67% after Intel CEO Lip-Bu Tan said memory demand was accelerating into 2027, Micron rose 5.50%, AMD jumped 6.36%, and Generac soared 18.34% on a major Amazon generator deal. The Dow added 0.61%.
The catalyst was the Fed decision itself, and more importantly how Chair Warsh framed it. The unanimous 12-0 vote to hike 25bps to 3.75–4% was fully priced; what markets had not priced was Warsh's relatively measured press conference, which avoided Trump trap questions cleanly and gave no forward commitments. Bond yields retreated: the US 10-year fell to ~4.93% after briefly topping 5% earlier this week, and the VIX dropped sharply to 15.44 from 17.71 the prior day.
| Index | Thu Sep 17 Close | Change | Change % |
|---|
| S&P 500 | 7,637.76 | +85.95 | +1.14% |
| Dow Jones | 51,779.85 | +317.95 | +0.62% |
| Nasdaq Composite | 26,418.30 | +439.87 | +1.69% |
| Nasdaq 100 | 29,446.98 | — | +1.73% |
| VIX | 15.44 | −2.27 | −12.82% |
| US 10-yr yield | 4.93% | −7.6 bps | — |
🔍 What the Fed Actually SaidThe FOMC raised its target range by 25bps to3.75–4.00%in a unanimous 12-0 vote — the first hike since July 2023. The dot plot showed 16 of 18 officials expect at least one more hike before year-end, with the median end-2026 projection at 4.1%. Markets now price ~53% odds of an October 27–28 hike. Warsh said inflation remains "too high for too long," cited Middle East tension as an additional factor, and notably declined to submit his own dot — consistent with his preference for optionality over forward guidance. Trump responded by calling for rates at "1% or lower."
🌍 Europe
European markets had a mixed day. The Bank of England held its benchmark rate at 3.75% in a 6-3 vote — as expected — with three MPC members pushing for a 25bps hike to 4%. Governor Bailey noted UK CPI rose to 3.1% in August and flagged the risk of further increases from the ongoing Iran-driven energy shock, while cautioning there was still little evidence of second-round wage effects. GBP/USD remained below 1.3500 near its 200-day moving average.
| Index | Thu Sep 17 Close | Change % |
|---|
| FTSE 100 (London) | ~10,720 | Est. +0.3–0.5%* |
| DAX (Frankfurt) | ~25,650 | Est. +0.3%* |
| CAC 40 (Paris) | ~8,230 | Est. +0.5%* |
| STOXX 600 | ~637 | Recovery |
*European close estimates pending official settlement; direction confirmed by intraday data.
🌏 Asia-Pacific
The Bank of Japan raised its policy rate 25bps to 1.25% Friday in a widely expected move — the third hike of 2026. The Nikkei responded positively, rising 1.51% on Friday (966 points) to close at 65,102, led by Lasertec (+8.98%), Advantest (+7.04%), and Mitsui Kinzoku (+6.22%), as the BoJ hike was seen as a sign of confidence in Japan's recovery rather than a tightening threat. The yen weakened modestly post-announcement.
| Index | Latest Close | Change % |
|---|
| Nikkei 225 (Tokyo) | 65,102 (Fri Sep 18) | +1.51% |
| Hang Seng (Hong Kong) | ~24,900 | Mixed |
| Shanghai Composite | ~3,955 | Flat/up slightly |
| Kospi (Seoul) | ~7,010 | Recovering |
| ASX 200 (Australia) | ~8,100 | Modest gain |
🛢️ Commodities
Oil pulled back for a second consecutive session as Saudi Arabia signalled it could restore roughly half of its East-West "Petroline" pipeline capacity within days and full operations within six weeks. Riyadh also moved additional crude cargoes to Asian refiners via ship-to-ship transfers near Oman's Sohar port — an improvised workaround for the Yanbu terminal disruption. Brent settled at US$104.82/bbl (−$1.01, −0.96%) and WTI at US$101.91/bbl (−$0.52, −0.51%). Both benchmarks remain up roughly 18% month-over-month. The Hormuz risk premium is still baked in — it has not gone away, it has merely moderated.
Gold bounced approximately 2% to around US$4,360–4,382/oz Thursday, recovering from Wednesday's near-six-week low (~US$4,263). The dollar retreating from a seven-week high after the Fed's presser, combined with falling yields, gave gold room to breathe. On Friday it extended gains toward US$4,400. In Canadian dollars, gold is approximately C$6,100–6,140/oz.
| Commodity | Price (Thu Sep 17 close) | Change |
|---|
| Brent Crude | US$104.82/bbl | −$1.01 / −0.96% |
| WTI Crude | US$101.91/bbl | −$0.52 / −0.51% |
| Gold (Dec futures) | US$4,382/oz | ~+2% vs Wed low |
| Silver | US$65.74/oz | +1.26% |
| Copper | US$6.62/lb | +1.66% |
| Natural Gas | US$2.87/MMBtu | −0.86% |
💱 Canadian Dollar & FX
The loonie was roughly flat near 71 US cents (approximately 1.408–1.41 USD/CAD) as the post-Fed dollar dip and recovering risk appetite offset the rate-differential headwind of higher US rates. Watch the October 27–28 FOMC meeting closely: a second consecutive Fed hike with no BoC response would put further pressure on the loonie, making imports — including many tariffed goods — more expensive at the checkout.
| Pair | Level | Direction |
|---|
| USD/CAD | ~1.408 | Roughly flat |
| CAD/USD | ~71 US cents | Near 1-month low range |
| USD Index (DXY) | ~99.95 | −0.02% (post-Fed pullback) |
| GBP/USD | ~1.3480 | Below 200-day MA |
| USD/JPY | ~143–144 | Yen softening post-BoJ hike |
💡 What It Means for Your WalletThe Fed hiking to 3.75–4% is the real story this week — not just as a US event, but as a Canadian one. Here's the direct chain:
Mortgages:If the BoC follows with its own hike on October 28 (National Bank and Scotiabank both forecast it), variable-rate mortgage holders face another ~$200–240/month increase on a $400,000 balance. Fixed-rate holders at renewal will find the 5-year bond yield — still elevated above 3.4% — has not softened meaningfully.
Savings accounts and GICs:The silver lining. Higher policy rates continue to support high-interest savings account (HISA) rates in the 4.5–5%+ range at online banks. If you haven't shopped rates recently, now is a good time.
Gas prices:Oil pulling back from $107 toward $102 Brent is modest relief, but WTI is still above $100 and up 18% this month. CAA national average gas prices remain near 178–180¢/L despite the gas tax holiday extension to January 31, 2027.
TFSA/RRSP investors:Thursday's TSX rebound — especially in gold miners and materials — was a reminder that volatility cuts both ways. Agnico, Barrick, WPM, Silvercorp all had strong days. If you've been sitting on commodity exposure in your registered accounts, the repricing created by oil and Middle East uncertainty isn't over.
📅 What to Watch Next
- Today (Fri Sep 18): UK August retail sales (07:00 BST) — first major UK data post-BoE hold; US weekly jobless claims
- Sep 29: US import bans on Canadian alcohol, whey/molasses, and motorcycles (800cc+) take effect — Ontario spirits and beer industry bracing for impact
- Oct 27–28: Next FOMC meeting (~53% odds of another 25bps hike per CME FedWatch); next BoC decision — will Macklem follow the Fed?
- Oct 28 (BoC): National Bank and Scotiabank forecast a hike to 2.50%; TD, BMO, and RBC see a hold. The divergence matters enormously for the loonie and for mortgage renewers
- Ongoing: Saudi Petroline pipeline restoration timeline (full capacity expected ~6 weeks); US-Iran Strait of Hormuz situation remains the wildcard for oil — and by extension Canadian gas prices and CPI
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