> ## Content Index > Fetch the complete content index at: https://www.leadlagreport.com/llms.txt > Use this file to discover other available public pages before exploring further. # The Fed’s First Hike in Three Years, and Copper Went Right Back to Its Record - URL: https://www.leadlagreport.com/the-feds-first-hike-in-three-years-and-copper-went-right-back-to-its-record/ - Published: 2026-09-22T18:41:13.000Z - Updated: 2026-09-22T18:41:13.000Z - Description: The Fed delivered its first hike in three years and the 10-year brushed 5%, the BoJ went to its highest rate since 1995 and the yen kept sliding, and copper ignored all of it, climbing back within 1.1% of its record while gold snapped its losing streak. - Author: Michael A. Gayed, CFA - Tags: Global View, Weekly *The first Fed hike in three years, a ten-year brushing 5%, and the Dow’s worst week since March: copper answered by climbing back within 1.1% of its record, and gold snapped its losing streak. The supply shock is winning the argument.* By Michael A. Gayed, CFA · September 22, 2026 ## Key Highlights - *The Fed hiked 25 basis points to 3.75%-4.00% on September 16, its first increase in three years, a 12-0 vote under Chair Kevin Warsh with 16 of 18 projections showing another hike, and the 10-year brushing 5.00% while the Dow fell 1.69%, its worst week since March.* - *The BoJ went to 1.25%, its highest since 1995, on a 7-2 vote, and the yen still slid past 157; the BoE held at 3.75% on a 6-3 vote with a warning that inflation tops 4% early next year. Three currencies tightened with Brent near $103.* - *Copper answered: from Monday’s $14,018.50 low it finished with its 11th weekly advance in 12, then added a fifth straight session Monday within 2% of its all-time high, while gold snapped a three-week losing streak at $4,380.* ## *Today’s Lead-Lag Report post is sponsored by* [*Tuttle Capital Management*](https://tcmlink.co/drmp-sept?ref=leadlagreport.com) ![Tuttle Capital Memory Stack Income Blast ETF (DRMP)](https://storage.ghost.io/c/b8/9e/b89e006c-adc9-4384-b804-e802e23b544e/content/images/2026/09/image1-3.png) **Special Announcement** The memory chips used in many AI data centers — DRAM, NAND, high-bandwidth memory — could be one of the tightest bottlenecks in the entire AI buildout. The Tuttle Capital Memory Stack Income Blast ETF (DRMP) seeks to provide concentrated exposure to that ecosystem while aiming to pay you along the way. 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All statements and expressions provided in the link are the sole opinion of Tuttle Capital Management and Lead-Lag Publishing, LLC expressly disclaims any responsibility for action taken in connection with the information provided in the link. --- Let me lead with the contradiction that defined this week. The Federal Reserve raised its target range 25 basis points to 3.75%-4.00% on September 16, the first increase since 2023, on a 12-0 vote under Chair Kevin Warsh, with 16 of 18 participants projecting another increase and markets pricing roughly 55% odds on October. The 10-year Treasury brushed 5.00% intraday, the 30-year sat at 5.33%, and the Dow dropped 1.69% to 51,682.64, its worst week since March. And the metal that was supposed to break under that combination spent the week climbing: from Monday’s low of $14,018.50 per tonne, copper finished with its 11th weekly advance in 12, and by Monday September 21 it had run a fifth straight session up to $14,710.50, within striking distance of the $14,875 record it set on September 10\. The tightening is real. The break is not coming. ![U.S. indices normalized year to date: S&P 500, Dow, Nasdaq 100, Russell 2000](https://storage.ghost.io/c/b8/9e/b89e006c-adc9-4384-b804-e802e23b544e/content/images/2026/09/chart1_Sep22-1.png) Chart 1: U.S. indices (SPY, DIA, QQQ, IWM), indexed to January 2, 2026. The texture underneath was a rotation, not a selloff. The S&P 500 closed Friday at 7,650.50, down just 0.08% on the week; the Nasdaq Composite gained 0.72% to 26,522.54; the Russell 2000 lost 1.50% to 2,860.40\. Goldman Sachs fell 8.5% and single-handedly shaved nearly a point off the Dow. Diesel printed a record $6.44 a gallon. And the VIX finished at 14.81, down 6.5% on the week: a Fed hike, a 5% ten-year, and the volatility complex did not blink. When the first hike in three years produces a 14.81 VIX, the market is telling you it fears something other than the Fed. Japan went the same direction with more consequences. The Bank of Japan raised its policy rate to 1.25% on September 18, its highest since 1995 and its sixth increase since March 2024, on a 7-2 vote, effective September 24; the country’s largest banks will pay savers 0.5% from November 2\. The yen’s answer was to slide past 157 to the dollar anyway, and the 10-year JGB ended the week at 2.947%. The Nikkei added 1.4% to 65,019 on Friday and is up 25.4% year to date, the best major developed market on the board. A central bank can normalize policy and still lose the currency; that is the gap between 1.25% and a Fed at 3.75%-4.00% with more dots to go. ![Developed markets normalized year to date: Nikkei 225, DAX, CAC 40, FTSE 100, STOXX Europe 600](https://storage.ghost.io/c/b8/9e/b89e006c-adc9-4384-b804-e802e23b544e/content/images/2026/09/chart2_Sep22-1.png) Chart 2: International developed markets (Nikkei 225, DAX, CAC 40, FTSE 100, STOXX Europe 600), indexed to January 2, 2026. The Bank of England chose not to move: a 6-3 hold at 3.75%, with the committee warning inflation tops 4% early next year, and a unanimous plan to unwind £488 billion of gilts. The 10-year gilt ended the week at 5.29%. Europe’s equities took a quiet bruising: the DAX fell about 1.0%, the CAC 40 about 1.4%, the STOXX Europe 600 about 0.6%, while the FTSE 100 held flat at 10,659 and is up 7.1% year to date. Put the three sovereign curves side by side, the U.S. 10-year near 5.00%, gilts at 5.29%, the JGB at 2.95%, and you see the same trade in three currencies: term premium repricing while policymakers tighten into a supply shock. The emerging split widened. Brazil’s Bovespa closed at 185,229.17, down 1.06% on the week for its first weekly loss in five, but still up 10.37% over the past month with a 14-day RSI of 71.6, and the real at 5.1445 to the dollar; the index is up 15.4% year to date. Korea’s KOSPI, up roughly 60% year to date at 6,894, took the week flat in stride. India is the holdout: the Sensex logged its sixth straight weekly loss, its longest streak since 2020, closing at 74,294.96, and the Nifty 50 is down 10.7% year to date even after Friday’s 0.33% gain to 23,346.40\. Hong Kong’s Hang Seng is down 6.0% year to date at 24,751\. China, meanwhile, held its loan prime rates for a 16th straight month (3.0% one-year, 3.5% five-year) and the yuan traded at its strongest since July 2022, 6.733 to the dollar. The commodity exporters are carrying the EM complex, and the importers are paying for it. ![Emerging markets normalized year to date: KOSPI, Hang Seng, China A-shares, Bovespa, Nifty 50](https://storage.ghost.io/c/b8/9e/b89e006c-adc9-4384-b804-e802e23b544e/content/images/2026/09/chart3_Sep22-1.png) Chart 3: Emerging markets (KOSPI, Hang Seng, ASHR, Bovespa, Nifty 50), indexed to January 2, 2026. Oil retreated without surrendering anything structural. Brent slipped 1.6% to $103.17 on Friday, its third straight down session, and WTI lost 4.7% on the week to $95.39, halting a two-week streak that had added nearly 20%. The Strait of Hormuz remains the tell: weekend transits ran 17 vessels against 37 the prior weekend, versus roughly 125 a day before the closure began. The U.S. Strategic Petroleum Reserve has been drawn to 285.4 million barrels, its lowest level since November 1982\. China has asked Iran to rein in the Houthis, which is what a country that imports the strait’s traffic does when it starts paying the freight. A $103 Brent with a $95 WTI and a 1982-level SPR is a market pricing interruption risk at the margin and scarcity underneath it. Gold did something it had not done in a month: it finished a week higher. The metal bottomed at $4,261.80 on Wednesday, surged 2.3% on Thursday once the hike was digested, and closed Friday at $4,380.01, up about 0.7% on the week and snapping a three-week losing streak; it traded as high as $4,400.60 on Friday. Wall Street analysts went full bull in the weekly Kitco survey. All of this happened with the dollar index up 1.1% on the week at 100.22 and EUR/USD at 1.15\. Gold rallying into a hawkish Fed and a rising dollar is the supply-shock signature: it is not trading real rates, it is trading the 285.4-million-barrel SPR. Bitcoin, for contrast, added 4.8% to $80,901 and is still down 8.8% year to date. ![Gold, dollar index, bitcoin and EUR/USD normalized year to date](https://storage.ghost.io/c/b8/9e/b89e006c-adc9-4384-b804-e802e23b544e/content/images/2026/09/chart4_Sep22-1.png) Chart 4: Gold, dollar index, bitcoin and EUR/USD, indexed to January 2, 2026. Last week I flagged copper as the canary: if it finally broke lower, my supply-shock read would flip to a growth scare. It answered. LME three-month copper opened the week at $14,065 and fell 1.2% Monday to $14,018.50, its lowest since August 20 and 5.9% below the record; COMEX printed an eight-week low near $6.20 a pound on Wednesday. Then the physical market took over: COMEX gained for a third straight session Thursday, Friday marked the 11th weekly advance in the last 12, and on Monday September 21 the December contract ran 3.3% to $6.8410 a pound, its highest since September 10\. The plumbing explains it: the Yangshan import premium finished last week at $124 a tonne, its highest in nearly four years; cash copper flipped to a $26 backwardation over three-month from an $86 discount a week earlier; LME stocks stand at 255,900 tonnes with 45% already cancelled, leaving 133,725 tonnes freely available; COMEX warehouses hold 696,204 tonnes, 69% of all exchange-monitored metal; Chilean output fell 9.4% in July and Codelco is warning its restructuring may slip to year-end. Funds cut their net longs into the dip and the price went up anyway. Chinese fabricators restock ahead of the September 25 holiday and the October 1-7 Golden Week. Scarcity does not care about the Fed’s dot plot. Put the week together and the argument is the same one this letter has been making, now with the policy response locked in: three central banks tightened, or held hawkish, into an oil price still holding near triple digits, and the commodity complex confirmed the shock rather than the tightening. The 10-year at 5.00%, gilts at 5.29% and the JGB at 2.95% are the transmission mechanism, and the equity market’s response was rotation (Dow down 1.69%, Nasdaq up 0.72%) rather than repricing. Copper knocking on its record with a 14.81 VIX is the market agreeing with the drill-bit economy and disagreeing with the dot plot. The risk to that read is unchanged: if copper breaks lower from here, it stops being a supply story and becomes a demand story, and everything above inverts. What I’m watching next week. First, the October FOMC, priced near 55% for a follow-on hike, and whether the strong-dollar, strong-long-end combination forces a rhetorical retreat. Second, Hormuz: whether weekend transits re-rate from 17 toward pre-war levels, and whether any U.S.-Iran diplomatic lane opens around the UN General Assembly. Third, copper at its Monday high into China’s Golden Week restock: a fresh record there would graduate the supply-shock thesis from contrarian to consensus. Fourth, the long end, the U.S. 10-year near 5.00% and the 30-year at 5.33% against gilts at 5.29% and the JGB at 2.947%, because global term premium is where the tightening actually transmits. Fifth, the EM split: India’s sixth straight weekly loss against Brazil’s 10.4% monthly run, and whether the Sensex streak extends while the commodity exporters consolidate. --- *The Lead-Lag Report is provided by Lead-Lag Publishing, LLC. All opinions and views mentioned in this report constitute our judgments as of the date of writing and are subject to change at any time. 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