Fed raises policy rate 25bp to 3.75–4.00% on Sept 16, 2026; signals at least one more hike

On September 16, 2026 the Federal Reserve raised its target federal funds range by 25 basis points to 3.75–4.00% and projected at least one more increase this year, lifting US policy rates and increasing upward pressure on global funding costs and African external USD eurobond curves.

Higher US policy rates increase discount rates used to value long-duration external debt and raise dollar funding costs. That typically exerts upward pressure on USD sovereign and corporate spreads in frontier markets, particularly for issuers with large upcoming external maturities or heavy dollar funding needs (e.g., Ghana, Zambia, Nigeria, and dollar-linked corporates in Mozambique and Kenya).

Markets will watch FOMC projections and the next meeting for timing of the projected additional hike.