The U.S. Federal Reserve on Wednesday implemented the fourth consecutive three-quarter point interest rate hike, amid the worst inflation in four decades.

The Fed raised its short-term borrowing rate by 0.75 percentage point to the highest level since January 2008.

The Fed will "take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments," according to a statement.

The rate raise is expected to put a dent in consumers' wallets, making it more costly for Americans to pay off debt or obtain a mortgage.

The widely-watched consumer price index showed in September that inflation dropped slightly to 8.2 percent on an annual basis, but climbed by 0.4 percent month on month.

Calls from lawmakers are growing for the central bank to stop its rate increases, as critics fret that it could spark a recession.

But the Fed has not given any indication that it would reverse course, as the central bank's goal is to pull inflation back down to its 2 percent target, even if those efforts trigger a recession.

Meantime, labor markets remain robust. Job openings abound and unemployment is low. But economists predict the possibility of a recession next year, particularly if the central bank continues to boost rates at such an aggressive pace.

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