Fed expected to intensify inflation fight with 75-basis point rate hike

Central bank could approve first 75-basis point rate hike since 1994

Megan Henney / FOXBusiness

 

The Federal Reserve is expected to ratchet up its fight to tame scorching-hot inflation on Wednesday with the first 75-basis point rate hike in close to three decades, a move that threatens to slow U.S. economic growth and exacerbate financial pressure on Americans.  

With inflation unexpectedly accelerating to a fresh 40-year high in May, the Fed is under mounting

Central bank policymakers raised the benchmark interest rate by a half-percentage point – double the typical size – in May, and laid out a roadmap for similarly sized increases at their meetings in June and July, assuming that data evolved as expected. But a string of alarming inflation reports in recent weeks could force the Fed to shift course.

A dismal Labor Department report last week showed the consumer price index rose 8.6% in May from a year ago, faster than expected. It marks the fastest pace of inflation since December 1981 and dashes economists' hopes that the consumer price spike was starting to fade. And a different survey released Monday showed that households are bracing for notably faster price increases – a worrisome sign because Fed officials believe such expectations can be self-fulfilling. Read more, see charts and video here.

'Started the Red Wave': Mayra Flores Flips Texas Border District in Special Election

Spencer Brown / Townhall Tipsheet

Republican Mayra Flores beat Democrat  Dan Sanchez on Tuesday in the special election for Texas' D+5 34th Congressional District, part of which falls along the U.S.-Mexico border.

Flores, who is also the first Mexican-American to be elected to Congress, won in the 84 percent Hispanic district — which Biden won by four points in 2020 — that covers an area of Rio Grande Valley not represented by a Republican since 1870, according to The Houston Chronicle. 

The special election for the 34th District was held to fill the vacancy created when Democrat Rep. Filemon Vela resigned his seat in order to become a lobbyist earlier this year, one of many Democrats who read the writing on the wall and saw the red wave coming in the midterms. 

Flores' campaign account celebrated her win late Tuesday night saying it "is for the people who were ignored so long" and "a message that the establishment will no longer be tolerated!" she added. "We have officially started the red wave!!" Read more and see tweets here.