For the second time, the Federal Reserve has chosen to maintain its target federal funds rate at this level. Due to worries about growing inflation, the Fed has raised interest rates eleven times in the last eighteen months, bringing the benchmark rate to a range of 5.25% to 5.5%, the highest in more than 20 years. Nonetheless, customers who are paying high borrowing fees won’t see quick relief from this decision.
The average interest rate on credit cards has risen to all-time highs, hurting individuals who carry balances. The 30-year fixed-rate mortgage rate, which is currently 8%—the highest in 23 years—is reducing homebuyers’ purchasing power. The average rate on a new five-year automobile loan is 7.62%, the most in sixteen years, and auto loan payments are rising as well.
On the other hand, increased deposit rates are helping savers, especially with online savings accounts that provide over 5% and a chance to beat inflation. Despite these challenges, customers should continue to exercise caution while managing their debt, look into advantageous loan arrangements, and take advantage of higher savings rates.
For expert guidance in navigating your financial matters or if you have any queries regarding the federal funds rate, we’re here to assist you. Please feel free to get in touch with us at any time – your financial well-being is our priority!