The Federal Reserve Board raised interest rates again Tuesday in its attempt to cool the economy and head off inflation. Banks quickly responded by increasing their prime lending rates.

The Fed lifted the discount rate on loans to its member banks to 4%, from 3.5%, and hiked its target rate on overnight loans of bank reserves, better known as the federal funds rate, to 4.75% from 4.25%.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.