Fed moves toward another big rate increase as inflation lingers

Economic data suggest that the United States could be headed for a rough road: Consumer confidence has plummeted, the economy could post two straight quarters of negative growth, new factory orders have sagged and oil and gas commodity prices have dipped sharply lower this week as investors fear an impending downturn.

But that weakening is unlikely to dissuade central bankers. Some degree of economic slowdown would be welcome news for the Fed — which is actively trying to cool the economy — and a commitment to restoring price stability could keep officials on an aggressive policy path.

Inflation measures are running at or near the fastest pace in four decades, and the job market, while moderating somewhat, remains unusually strong, with 1.9 available jobs for every unemployed worker. Fed policymakers are likely to focus on those factors as they head into their July meeting, especially because their policy interest rate — which guides how expensive it is to borrow money — is still low enough that it is likely spurring economic activity rather than subtracting from it.