Federal Reserve Hikes Interest Rates in Bid to Tame Inflation

The U.S. Federal Reserve raised its benchmark interest rate for the first time in three years on Wednesday, increasing it to a target range of 3.75 percent to 4 percent.

This quarter-point hike was accompanied by a signal from the central bank that one additional rate increase is expected later this year as part of its efforts to bring inflation down to its 2 percent target.

According to Fed Chair Kevin Warsh, further rate increases will be necessary if inflation does not improve. This move could potentially invite criticism from President Trump, who has repeatedly called for lower rates and recently threatened to halt trade with countries the U.S. has a trade deficit with.