https://www.cnn.com/2023/02/24/econo...ary/index.html
"Inflation surprisingly rose in January [2023]". No sh!t. Feds think just by raising rates, this will solve inflation. While raising rates is only part of the solution (and will only help up to a certain point with current conditions), the other part of the issue is the supply chain issue. The Feds are looking at the playbook from previous periods of inflation, and the issue with this is there hasn't been anything prior to what is going on right now in the world with the backend of a pandemic and the war in Ukraine. Global supply chain and shortages are still a problem, particularly semiconductor chips, and most production/manufacturing companies use borrowed money to fund a large portion of their operations. So if rates go up and borrowing costs go up, these companies will produce less in an already short-supply environment, which would drive up inflation based on simple supply/demand economics. Not sure why this is such a hard concept for the Feds to grasp.
For those that are thinking car prices will come down, don't expect this to happen any time soon. The issue with semiconductors is production requires neon gas, and guess who supplies half of the world's supply of this? Ukraine, and I doubt they are currently focusing on producing this with the war going on.