The Federal Reserve is stepping up its war on inflation. That means borrowing costs are going sharply higher for families and businesses.

The US central bank last increased its benchmark interest rate by three-quarters of a percentage point, which is the biggest single hike since 1994.

This follows the Fed's decision to raise its rate by half a percentage point in May, the biggest increase in 22 years.

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The Fed is expected to announce another three-quarters of a point rate hike on Wednesday at 2 p.m.

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The fact that the Fed is moving decisively shows confidence in the health of the job market. But the speed with which interest rates are expected to go up underscores its growing concern about the soaring cost of living.

High inflation will likely force the Fed to raise interest rates several more times in the coming months. Fed officials may even resort to additional large rate increases in a bid to cool off inflation.

Americans will initially experience this policy shift through higher borrowing costs: It is no longer insanely cheap to take out mortgages or car loans. And cash sitting in bank accounts will finally earn something, albeit not much.

The Federal Reserve is stepping up its war on inflation. That means borrowing costs are going sharply higher for families and businesses.

The US central bank last increased its benchmark interest rate by three-quarters of a percentage point, which is the biggest single hike since 1994.

This follows the Fed's decision to raise its rate by half a percentage point in May, the biggest increase in 22 years.

*

The Fed is expected to announce another three-quarters of a point rate hike on Wednesday at 2 p.m.

*

The fact that the Fed is moving decisively shows confidence in the health of the job market. But the speed with which interest rates are expected to go up underscores its growing concern about the soaring cost of living.

High inflation will likely force the Fed to raise interest rates several more times in the coming months. Fed officials may even resort to additional large rate increases in a bid to cool off inflation.

Americans will initially experience this policy shift through higher borrowing costs: It is no longer insanely cheap to take out mortgages or car loans. And cash sitting in bank accounts will finally earn something, albeit not much.