The Federal Reserve raised interest rates by a quarter of a percentage point on Wednesday, the first major step by Kevin M. Warsh, the central bank’s chairman, to combat elevated inflation. The decision, supported by all 12 members of the Federal Open Market Committee, marked the first rate rise since July 2023.

The increase lifts the Fed’s benchmark rate to a new range of 3.75 to 4 percent. Fed policymakers indicated further increases likely in the meetings ahead. The decision came as President Trump continued to press for lower rates. But Mr. Warsh said the central bank had to act to tame inflation, which it aims to keep at 2 percent. “The plain fact is that inflation is too high and has been for too long,” he said.

According to the latest “dot plot,” the vast majority of policymakers expect at least one more quarter-point increase by the end of the year. Four officials thought rates would need to rise half a percentage point; two penciled in cuts.

Most officials see inflation ending the year at 3.7 percent, up from prior estimates. Policymakers projected the economy would expand 2.3 percent in 2026 and 2.4 percent in 2027. Higher rates will compound housing affordability challenges, said Robert Dietz of the National Association of Homebuilders.