Why the Fed’s latest interest rate hike is controversial

On Wednesday, the Federal Reserve raised interest rates another quarter point in regulators’ ongoing bid to reduce inflation. It’s a move that marks the Fed’s 10th straight rate hike and it’s one that’s proven contentious given fears that it could slow the economy too much.

The rate hike — which puts the Fed’s benchmark rate between 5 to 5.25 percent — comes as another mid-size bank, First Republic Bank, failed and was later acquired by JPMorgan Chase, becoming the second-largest bank failure in US history. The Fed favors the hike because it’s continuing to fight inflation,...