The Fed Just Raised Interest Rates Again Despite Recent Bank Failures. Here's What It Means for You
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It’s official: Interest rates are rising again — but the end of hikes may be in sight.
On Wednesday, the Federal Reserve announced another quarter-point rate hike, bringing the target federal funds rate to between 4.75% and 5%. That benchmark rate impacts everything from credit card APRs to auto loans to mortgage rates.
It’s the ninth consecutive time the central bank has raised rates in an attempt to bring down inflation and cool the economy. Consumer price growth has slowed somewhat since peaking at 9% in June, but the latest reading of 6% in February is still too high for the Fed’s liking. That's not to mention the fact that measures of hiring and consumer spending are actually higher than experts think they should be, which indicates an economy in danger of overheating.
In a press conference on Wednesday, Federal Reserve Chair Jerome Powell noted that the labor market remains very tight, and that “the process of getting inflation back down to 2% has a long way to go and is likely to be bumpy.”
Here’s everything you need to know about what the latest interest rate increase means for you.
