Fed interest rates hike in effort to tame inflation comes as Americans struggle with rising costs

LOMBARD, Ill. (WLS) -- The Federal Reserve is raising a key interest rate in an effort to tame inflation, in the Fed's most aggressive move in 22 years.

The hike comes as Americans are struggling with rising costs everywhere.

We take a look at where you'll see the biggest impacts of this hike.

Meagan Pingel said she's ready to buy a house. She has been looking with her realtor for weeks, all while watching mortgage rates climb.

"It brings our price range down. Where does that leave us," Pingel said.

Inflation is the highest it's been in 40 years and is affecting nearly everything consumers buy.

Prices are up dramatically at grocery stores. Oil and gas prices are continuing to rise with no end in sight, causing serious pain at the pump.

Economists said the Federal Reserve is attempting to control inflation by raising interest rates.

RELATED: Federal Reserve raises short-term interest rate by a half-point in bid to curb inflation

"This is probably going to be the most aggressive rate-tightening cycle we've seen by the Fed since the 1980s," said Diane Swonk, chief economist at Grant Thornton.

As mortgage lenders expected, the Fed announced a half-point increase in interest rates Wednesday afternoon.

However, realtors said this is a double whammy. Not only are mortgage rates rising, meaning buyers have less to offer, but the shortage of homes on the market means demand is up and prices are rising.

"Some are getting discouraged. The rates have gone up. Some have decided to rent again or wait it out," said Kate Drury with @Properties.

For perspective, mortgage rates hit an all-time low in 2012 at 3.31%. The all-time high was in 1981 at nearly 19%. Currently, rates are a little more than 5%, but realtors said the market is attracting investors with cash offers, making it especially tough on new buyers.

"Crowding out many first-time homebuyers that were finally getting their chance at not only buying a home but moving up the ladder of wealth accumulation that goes with it," Swonk said.

Realtors said the scarcity of homes on the market means many are selling at asking price or above.