The Fed boosted interest rates 0.75% — the most since 1994. Here's how it will affect your wallet.

Earlier this year, the Federal Reserve turned to its most potent weapon — raising interest rates — to combat soaring inflation. But with consumer prices having only accelerated since then, the central bank boosted rates by 0.75% on Wednesday — its largest hike since 1994 — to try to tame the nation's fiercest bout with inflation in 40 years. 

The rate hike follows the announcements of a 0.25% hike in March and a 0.5% move in May — with the latter marking the sharpest increase since 2000.

The Fed had earlier been expected to boost rates by a more modest 0.5%, but the bank opted for a larger hike after the Consumer Price Index, a broad basket of goods and services used to track inflation, surged 8.6% in May, from an 8.3% annual rate in April. Gasoline prices have continued to hit new highs almost daily amid depleted domestic production and Russia's war in Ukraine, while food and housing costs are also surging.