U.S.-WASHINGTON, D.C.-FED-BENCHMARK INTEREST RATE-RAISING
WASHINGTON (AP) — Federal Reserve Chair Jerome Powell has pledged to do whatever it takes to curb inflation, now raging at a four-decade high and defying the Fed’s efforts so far to tame it.
Increasingly, it seems, doing so might require the one painful thing the Fed has sought to avoid: A recession. A worse-than-expected inflation report for May helped spur the Fed to raise its benchmark interest rate by three-quarters of point Wednesday and to signal that more large rate hikes are likely coming.
Economic history suggests that aggressive, growth-killing rate hikes could be necessary to finally control inflation. And typically, that is a prescription for a recession.
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