US central bank hikes interest rates and signals more to come, defying Trump

The Federal Reserve unanimously voted Wednesday to raise interest rates for the first time in three years and signaled it might hike again this year, a move that will test the delicate relationship between President Donald Trump and his new Fed chair, Kevin Warsh. Central bankers are increasingly worried that inflation — worsened by soaring oil prices and an artificial intelligence investment boom — is not on a path back to their 2% target. The decision comes less than seven weeks out from elections that will determine the balance of power in Congress, and as investors have already been driving long-term rates to nearly two-decade highs. The Fed's benchmark rate is now set between 3.75% and 4%.