Ever wonder how the Fed's interest rate actually works? We've got answers

The Federal Reserve just raised interest rates this week for the first time this year. So how does it actually work? And what does it mean for the economy — and the rest of us? Here are some answers.

<img src='https://npr.brightspotcdn.com/dims3/default/strip/false/crop/5472x3648+0+0/resize/5472x3648!/?url=http%3A%2F%2Fnpr-brightspot.s3.amazonaws.com%2Fbe%2F3e%2F812d039d41f29656f9b92aed1411%2Fap20100194370143.jpg' alt='The Fed's interest rate hike is bound to raise borrowing costs across the economy — but it's intended to help bring down inflation.'/><p>The Federal Reserve just raised interest rates this week for the first time this year. So how does it actually work? And what does it mean for the economy — and the rest of us? Here are some answers.</p><p>(Image credit: LM Otero)</p><img src='https://media.npr.org/include/images/tracking/npr-rss-pixel.png?story=nx-s1-5969816' />