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Federal Reserve Board Chair Jerome Powell speaks during a news conference at the Federal Reserve, Wednesday, May 4, 2022 in Washington. (AP Photo / Alex Brandon, File)

The central bank is ramping up its drive to tighten credit and slow growth with inflation having reached a four-decade high of 8.6%, spreading to more areas of the economy and showing no sign of slowing. 

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Bags of Pistachios are displayed at a grocery store in Mount Prospect, Ill., on, April 1, 2022. (AP Photo/Nam Y. Huh)

Consumer prices surged 8.6% last month from a year earlier, faster than April’s year-over-year increase of 8.3%, the Labor Department said Friday. The new inflation figure, the highest since 1981, will heighten pressure on the Federal Reserve to continue raising interest rates aggressively.

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In this photo provided by the New York Stock Exchange, specialist Douglas Johnson works on the trading floor, Monday, May 23, 2022. (David L. Nemec / New York Stock Exchange via AP)

The S&P 500 rose 1.9%, with technology and financial sector stocks doing much of the heavy lifting for the benchmark index. The Dow Industrial Average rose 2% and the Nasdaq climbed 1.6%.

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This May 4, 2021, file photo shows the Federal Reserve building in Washington. (AP Photo / Patrick Semansky, File)

The substantial half-point hike in its benchmark short-term rate that the Federal Reserve announced Wednesday won’t, by itself, have much immediate effect on most Americans’ finances. But additional large hikes are expected to be announced at the Fed’s next two meetings, in June and July, and economists and investors foresee the fastest pace of rate increases since 1989.

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The wilder action was in oil and Asian stock markets, where tightened anti-COVID measures in China are raising worries about demand for energy and about disruptions to manufacturing and global trade. Oil prices tumbled more than 8%, taking some pressure off the world’s high inflation, and a barrel of U.S. crude fell below $95 after starting the week above $109. 

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In this photo provided by the New York Stock Exchange, trader Phyllis Arena Woods works on the floor, Monday, Jan. 24, 2022. (Courtney Crow / New York Stock Exchange via AP)

The stock market extended its three-week decline and put the benchmark S&P 500 on track for a so-called correction — a drop of 10% or more from its most recent high. 

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People look at televisions during a Black Friday sale at a Best Buy store on Friday, Nov. 26, 2021, in Overland Park, Kan. (AP Photo / Charlie Riedel, File)

Economists are now voicing a more discouraging message: Higher prices will likely last well into next year, if not beyond.

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In this Dec. 1, 2020 file photo, Chairman of the Federal Reserve Jerome Powell appears before the Senate Banking Committee on Capitol Hill in Washington. (AP Photo / Susan Walsh, Pool, File)

The Federal Reserve signaled Wednesday that it may act sooner than previously planned to start dialing back the low-interest-rate policies that have helped fuel a swift rebound from the pandemic recession but have also coincided with rising inflation. 

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In this Dec. 1, 2020 file photo, Federal Reserve Chair Jerome Powell listens during a Senate Banking Committee hearing on Capitol Hill in Washington. (Al Drago / The New York Times via AP, Pool)

Federal Reserve Chair Jerome Powell underscored the U.S. economy’s ongoing weakness Tuesday in remarks that suggested that the Fed sees no need to alter its ultra-low interest rate policies anytime soon. 

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Federal Reserve Board Chairman Jerome Powell testifies during a Senate Banking Committee hearing, Thursday Sept. 24, 2020 on Capitol Hill in Washington about the CARES Act and the economic effects of the coronavirus pandemic. (Drew Angerer / Pool via AP)

The Fed announced no new actions after its latest policy meeting but left the door open to provide further assistance in the coming months. 

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(NikolayFrolochkin / Pixabay)

According to the Federal Reserve, the gap between the rich and the not-so-rich in the U.S. is getting wider. What that new data may mean for economic inequality in America. 

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Federal Reserve Board Chairman Jerome Powell testifies during a Senate Banking Committee hearing, Thursday Sept. 24, 2020 on Capitol Hill in Washington about the CARES Act and the economic effects of the coronavirus pandemic. (Drew Angerer / Pool via AP)

Federal Reserve Chair Jerome Powell warned Tuesday that a tentative recovery from the pandemic recession could falter unless the federal government supplies additional economic support.

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(Jason Rogers / Flickr)

Whether piled up in change jars, cup holders or couch crevices, coins are not circulating, and that makes it difficult for businesses to deal in cash, the U.S. Coin Task Force says. Here’s how to help.

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Paul Krugman appears on “Chicago Tonight” on Tuesday, Feb. 25, 2020. (WTTW News)

A conversation with with the Nobel Prize-winning economist and New York Times opinion columnist about his new book, “Arguing With Zombies: Economics, Politics, and the Fight for a Better Future.”

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The Eccles Building in Washington D.C. serves as the headquarters of the Federal Reserve. (AgnosticPreachersKid / Wikimedia Commons)

While the U.S. economy continues its record-breaking expansion, some wonder whether the Fed reacted to softening global markets or perhaps even pressure from President Donald Trump.

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In this June 18, 2019, photo people walk past Fidelity Investments news scroll board, showing a favorable outlook in the US stock markets, in the Financial District of Boston. (AP Photo / Charles Krupa)

The Fed under Chairman Jerome Powell has signaled that rising economic pressures — notably from President Donald Trump’s trade wars and from a global slowdown — have become cause for concern. So has an inflation rate that remains chronically below the Fed’s target level.