Record-low mortgages below 3%, reached last year, are long gone. Credit card rates will likely rise. So will the cost of an auto loan. Savers may finally receive a yield high enough to top inflation.
WASHINGTON —
Here are some questions and answers about what the rate hikes could mean for consumers and businesses:Rates on home loans have soared in the past few months, partly in anticipation of the Fed’s moves, and will probably keep rising. In part, the jump in mortgage rates reflects expectations that the Fed will keep raising rates. But its forthcoming hikes aren’t likely fully priced in yet. If the Fed jacks up its key rate to as high as 3.5% by mid-2023, as many economists expect, the 10-year Treasury yield will go much higher, too, and mortgages will become much more expensive.
Still, the number of available homes remains historically low, a trend that will likely frustrate buyers and keep prices high.For users of credit cards, home equity lines of credit and other variable-interest debt, rates would rise by roughly the same amount as the Fed hike, usually within one or two billing cycles. That’s because those rates are based in part on banks’ prime rate, which moves in tandem with the Fed.
Savings, certificates of deposit and money market accounts don’t typically track the Fed’s changes. Instead, banks tend to capitalize on a higher-rate environment to try to increase their profits. They do so by imposing higher rates on borrowers, without necessarily offering any juicer rates to savers.This is particularly true for large banks now. They’ve been flooded with savings as a result of government financial aid and reduced spending by many wealthier Americans during the pandemic.
México Últimas Noticias, México Titulares
Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.
Central Bank Watch: Fed Speeches, Interest Rate Expectations Update; May Fed Meeting PreviewRates markets are fully pricing in a 50-bps rate hike by the Federal Reserve on Wed. We’ll discuss how markets may react to the rate decision starting at 13:45 EDT/17:45 GMT on Wednesday.
Leer más »
Fed expected to aggressively raise interest rates to tame inflationThe Fed is expected to raise interest rates this week with the biggest jump in more than 20 years as the central bank tries to get control of historic inflation.
Leer más »
Fed poised to hike rates by half a percentage point to fight inflationThe Federal Reserve is expected to raise interest rates again Wednesday, this time by half a percentage point, in an aggressive step toward combating the highest inflation in 40 years.
Leer más »
Fed raises interest rates by half-point, the most since 2000The Federal Reserve intensified its drive to curb the worst inflation in 40 years by raising its benchmark short-term interest rate by a sizable half-percentage point.
Leer más »
The Fed raises interest rates by the most in over 20 years to fight inflationThe Federal Reserve raised interest rates by half a percentage point Wednesday, in an effort to cool off demand and lower inflation. Consumer prices have been rising at the fastest pace in 40 years.
Leer más »
US Dollar Index looks cautious around 103.60, Fed gathering starts todayThe greenback, in terms of the US Dollar Index (DXY), lacks a clear direction although it manages well to navigate in the upper end of the recent rang
Leer más »