The Federal Reserve passes the buck on inflation

The mission of the Federal Reserve is to foster the stability of US monetary systems. It's the reason the central bank was created in 1913, and it's the reason it still exists today. 

So when inflation threatens to potentially destabilize the dollar, it's the Fed's job to spring to action. There are a number of tools at their disposal..

but the most effective in this situation is to cool the economy by raising interest rates. With inflation rates in the US now at 40-year highs, that's what the Fed is doing. 

Federal Reserve chair Jerome Powell announced last week that the Fed will increase interest rates by an aggressive three-quarters of a percentage point, the largest hike in 28 years.

But he also struck a more somber tone than he had in prior meetings, admitting that some factors are out of his control. 

Earlier this month, when economic data showed that inflation was still at a 40-year high ...

and that consumer sentiment had tumbled to a record low, the Biden Administration pointed to the Federal Reserve's role in getting prices under control

"The Fed has the tools that it needs, and we are giving them the space that it needs to operate," said Brian Deese, the director of the National Economic Council.