With inflation at 40-year high, interest rates expected to increase again

WASHINGTON (Nexstar) — The Federal Reserve is expected to announce another interest rate hike this week, which could be the biggest hike the U.S. has seen in decades.

The interest rate is expected to go up as much as three-quarters of a percentage point, the sharpest increase in more than 25 years. The Federal Reserve expects higher interest rates will slow down demand and get inflation under control.

"We've gotta do it so it doesn't affect economic growth in a big way. We have some of the strongest economic growth we've had in the past 20 years," said Ohio Senator Sherrod Brown.

There are fears that if interest rates go up too quickly, an economic recession could occur. Both Democrats and Republicans are playing the blame game over what's pushed inflation to a 40-year high.

"What we need is a president who is willing to listen, who is actually willing to work with people on the other side to address these serious problems," said Rep. Steve Scalise (R-La.).

But President Biden said that Republicans are the ones who are halting plans to address the issues.

"Republicans in Congress are doing everything they can to stop my plans to bring down costs for ordinary families," Biden said.

The pandemic and related labor shortages have strained supply chains around the world for more than two years, and the war in Ukraine is making problems worse by pushing up wheat and energy prices.

"This is a crisis of epic proportions that could have been avoided and still could be stopped," said Rep. Diana Harshbarger (R-Tenn.).

President Biden says his administration is working to address the problem.

"We made extraordinary progress and we put America in a position to tackle a worldwide problem that's worse everywhere but here," Biden said.