Spent some time this month actually thinking through what February's surprise hike means, rather than just reacting to it. My read, and it's just a read, not a confident forecast given how wrong forecasts have been through this whole cycle, is that this isn't the start of a new sustained hiking cycle. It's more likely a correction, an acknowledgment that the pace of cuts through 2025 ran slightly ahead of what the underlying data actually supported.
If that's right, it means one or two more hikes to walk back the overshoot, then another hold, rather than a return to anything like the 2022 to 2023 hiking cycle in scale.
I'm positioning cautiously either way, same discipline I've kept through every phase of this cycle. Make sure everything works at a rate a point higher than wherever we currently sit, and adjust from there as the picture clarifies.