Fed reportedly considering hiking interest rates by three-quarters of a point this week

Markets are anticipating an even faster pace of interest rate hikes, and Federal Reserve officials are considering the possibility.

According to a Wall Street Journal report, central bank policymakers are considering increasing the Fed's benchmark funds rate by 75 basis points. Mortgages and credit cards are among the products that are based on the rate.

In recent days, traders in the fed funds futures market have been increasing their bets that the Fed will change its hiking pattern.

Bond yields pointed to the possibility of a more aggressive Fed after the two-day Federal Open Market Committee meeting that ends Wednesday.

The 10-year yield shot up to 3.37%, a jump of 21 basis points, while the 2-year yield jumped to 3.34%, a jump of 30 basis points. One hundredth of a percentage point is a basis point.

Inflation is running at more than 40-year highs because of the Fed's use of interest rate increases. Markets think the central bank will keep raising rates through the end of the year as it tries to bring inflation down.

According to the Journal report, officials could rethink their stance on rates in light of recent reports showing that inflation is not only high historically but is still pushing upward. Ahead of the Open Market Committee meeting on Tuesday, the Fed is in a quiet period so it can't say anything about policy.

The headline inflation in May was 8.6%. A survey from the New York Fed shows that one-year inflation expectations are at a record high.

Clogged supply chains are pushing up prices, while energy prices are rising due to decreased production, a situation made worse by the Russian attack onUkraine. Wages are going up because of a supply-demand mismatch in the labor market.