Fed Begins Inflation Fight With Key Rate Hike, More to Come

Fed Begins Inflation Fight With Key Rate Hike, More to Come
Federal Reserve Chairman Jerome Powell testifies before the Senate Banking Committee hearing, on Capitol Hill on March 3, 2022. Tom Williams/Pool via AP
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WASHINGTON—The Federal Reserve launched a high-risk effort Wednesday to tame the worst inflation since the 1970s, raising its benchmark short-term interest rate and signaling potentially up to seven rate hikes this year.

The Fed’s quarter-point hike in its key rate, which it had pinned near zero since the pandemic recession struck two years ago, marks the start of its effort to curb the high inflation that has followed the recovery from the recession. The rate hikes will eventually mean higher loan rates for many consumers and businesses.