In a widely anticipated move, the nation’s central bank raised short-term borrowing rates by three-quarters of a percentage point on Wednesday, the sixth increase this year. The 0.75-point increase, which brings the short-term borrowing rate to a target range of 3.75-4 percent, highlights the most aggressive period of monetary policy since the early 1980s as the Federal Reserve attempts to reign in inflation, spurred by supply and demand imbalances and high energy costs. “The U.S. economy has slowed significantly from last year’s rapid pace,” said Fed Chair Jerome Powell, commenting on high mortgage rates and tightening purses, despite a strong labor market. “The longer the current bout of high inflation continues, the greater the chance that expectations of high inflation will become entrenched.” Powell added that the Fed is committed to returning inflation to its 2 percent goal, but will “stay the course” on its stringent rate increases.
