Market Minute: A Fed Hike and Rising Yields Shaped Fixed Income in September
ALLYSON KRAUTHEIM, PORTFOLIO SPECIALIST
October 5, 2026
The Federal Reserve raised rates in September, which was largely expected after Fed Chair Kevin Warsh's hawkish tone at Jackson Hole, and markets are now pricing in tighter monetary policy through 2027. Meanwhile, yields jumped significantly, with inflation worries, competition for capital from AIissuance and the deficit all floated as reasons.
Portfolio Specialist Ally Krautheim breaks down what's behind the move and what rising yields mean for bond investors.
The Victory Income Investors team's take: Long-term inflation expectations still look anchored, and historically, most of a bond's total return has come from income, not price swings.
