Diesel Prices Soar Past $6/Gallon as Fed Raises Interest Rates

The Federal Reserve raised interest rates for the first time since 2023, increasing its benchmark by a quarter point to 3.75%-4%. The unanimous 12-0 vote was met with market expectations of at least one more rate increase this year, according to forecasts from policymakers.

Inflation remains high, running at 3.4%, unchanged from July but above the Fed's 2% target. Officials revised their forecasts for inflation and growth higher, and unemployment lower.

The real impact of the rate hike was felt in the fuel market, where prices have surged due to global supply chain disruptions. The average price of diesel in Michigan hit a record high of $6.54 per gallon, while regular gas prices rose 45 cents in a week to reach nearly $4.76.

J.B. Hunt Transport Services warned that its third-quarter profit would fall 5% to 10%, citing added driver expenses and fuel costs. The company's stock fell 13.3% on the news, marking the worst weekly performer in the S&P 500.