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Inflation is fundamentally an oversupply of money. As the demand and production of goods remains static while the supply of cash circulating in the country increases, cash will naturally shed some of its value..
Raising the interest rate, including the short-term lending rate banks charge other banks, known as the Fed funds rate, affectively tightens the creation and transference of money in the U.S.
read this:https://investorplace.com/2022/08/why-does-the-interest-rate-increase-help-inflation/
@disk4mat @sistersib except that is predicated on premises that aren't sound. The issue isn't demand-pull from consumers, it's largely supply-side issues due to the pandemic, wars, climate change and crumbling infrastructure. Throw on top of that OPEC purposefully increasing the price of fuel and corporations using this time to jack up prices to pad their profits. Food and electronics are two areas that are legitimately demand-pull.
https://www.levyinstitute.org/pubs/ppb_157.pdf