What does the Fed hiking interest rates mean to you?
CLEVELAND, Ohio (WOIO) - The Federal Reserve is looking to combat inflation by boosting interest rates.
According to CBS News, the Fed announced a half a percentage point raise on interest rates to try and put down demand on goods and services.
CBS says that “Every 0.25% increase equates to an extra $25 a year in interest for $10,000 in debt. So a 50 basis point increase will translate into an extra $50 of interest for every $10,000 in debt. However, economists don’t expect the Fed to stop raising rates after Wednesday’s announcement. Economists are forecasting the Federal Reserve will direct another 50 basis point increase in June, with additional increases to follow later in 2022. By year-end, the federal funds rate could reach 2% or higher, according to LendingTree Senior Economic Analyst Jacob Channel. That implies a rate increase of about 1.5% from current levels, which means consumers could pay $150 in additional interest for every $10,000 in debt”.
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