WASHINGTON — In the most aggressive back-to-back interest rate increases since the early 1980s economic crisis, the Federal Reserve on Wednesday announced another three-quarters of a percentage point hike and signaled that it wasn’t done in its effort to beat back inflation despite rising risks of triggering a recession.
The Fed’s hefty increase in its benchmark rate, which forms the basis for borrowing costs on credit cards, home loans and other products, is aimed at further cooling the economy to help curb pricing pressures.
In its statement announcing the rate change, the Fed noted the slowing economy. “Recent indicators of spending and production have softened,” it said, adding that the Fed expects to make “ongoing increases” in its key interest rate as it strives to return inflation to its 2% target.
