FILE - Federal Reserve Chairman Jerome Powell speaks to the Senate Banking, Housing and Urban Affairs Committee, as he presents the Monetary Policy Report to the committee on Capitol Hill, on June 22, 2022, in Washington. With inflation raging at a four-decade high and the job market strong, the Fed is under pressure to raise interest rates aggressively. (AP Photo/Manuel Balce Ceneta, File)
Jerome Powell
WASHINGTON (AP) — The Federal Reserve raised its benchmark interest rate by a hefty three-quarters of a point for a second straight time in its most aggressive drive in three decades to tame high inflation.
The Fed’s move will raise its key rate, which affects many consumer and business loans, to its highest level since 2018. The central bank’s decision follows a jump in inflation to 9.1%, the fastest annual rate in 41 years.
By raising borrowing rates, the Fed makes it costlier to take out a mortgage or an auto or business loan. Consumers and businesses then presumably borrow and spend less, cooling the economy and slowing inflation.
—Copyright 2022 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
