Federal Reserve raises rates to combat Biden-era inflation

The Federal Reserve raises its benchmark interest rate by 25 basis points, the first increase since December 2018, beginning an unprecedented rate hike cycle in response to surging inflation. By July 2023 the Fed raises rates 11 times, taking the federal funds rate from near-zero to 5.25-5.5%, the highest in 22 years. The aggressive tightening contributes to the rapid disinflation that brings inflation from 9.1% (June 2022) down to 2.9% (July 2024), but also raises mortgage rates to 7%+, crushing housing affordability and contributing to Biden's persistently negative polling on the economy despite other strong economic indicators.