Federal Reserve Raises Interest Rates by Half-Point in Biggest Hike Since 2000

The Federal Reserve on Wednesday raised its benchmark interest rate by half a percentage point, marking the largest interest hike since 2000.

Following a quarter-point increase in March, the move marks a shift in strategy as the Fed tackles a 40-year high in inflation. "Inflation is much too high, and we understand the hardship it is causing," Fed Chairman Jerome Powell said. "And we're moving expeditiously to bring it back down." While Powell emphasized that the Fed would not raise interest rates higher than half a percentage point at a time, he hinted that two additional boosts could be warranted in June and July given the current state of the economy.

Some voices across the spectrum expressed concern that the move could trigger an economic recession. New York Magazine (Left bias) accentuated how the central bank has "essentially put the economy in reverse and jammed on the accelerator in a bid to speed away from inflation." The outlet also predicted that consumers will "probably stop spending so much and then it will get harder for businesses to pay for goods and make payroll" since credit will get more expensive. The Daily Wire (Right bias) highlighted how the Biden administration is "struggling to curb inflation without jeopardizing economic growth." They also emphasized how Powell insisted that inflation was "transitory" and not a threat to the economy about a year ago but later "ate his words." Axios (Center bias) noted that Powell is "putting the problem squarely on his own shoulders" and is "moving fast" to make up for his delayed response.