The Federal Reserve voted Wednesday to raise interest rates by a quarter-percentage point. This raise takes the rate from 1.75% to 2%. The fed is also now forecasting this is just the beginning as they are expecting to raise their rates four more times this year.
WAAY 31 spoke with local consumers today who had mixed opinions about the increase....although most aren't fans of the rising rates...they seem to agree if you're a saver, you could be in luck.
"I don't think that there's anyone who loves the fact the the interest rates are increasing and it does make a difference for local consumers and certainly I'm concerned about those who are just trying to make ends meet."
Jacqui Shipe tells WAAY she thinks this increase is connected to new tax rules passed by the trump administration, saying issues like interest rates are something people were not aware of or prepared for.
"It certainly creates a road block for individuals who have saved and who have factored in what they could afford in terms of purchasing a home or a car or educational loans, and now that the interest rates are going up that's probably a dimension that they did not factor in."
And she's right, according to usa today, this increase will have the greatest impact on those with adjustable rate mortgages and home equity lines of credit. As well as a small impact on auto loans. The average cost would jump about 3 dollars per month.
WAAY 31 also spoke with consumer, Daid Eason, who isn't concerned about the increase and in fact thinks it's probably necessary in order for the economy to grow.
"Not at this time...No, I think it's probably a needed correction. I'm thinking anything we can do to promote savings, so that there's capital available for investments and make the economy grow...sounds good.""
This increase will benefit savings accounts...as some bank customers will start to see noticeably highter savings rate. If you're concerned this could affect a loan you have out...if you have a fixed rate, it will not change.
The new interest rate will also have an affect on your credit card rates...The average rate is 17%. So if you have a $10,000 credit card balance a quarter point jump will add about $25 a month in interest.
As far as when the next increase will be, the feds are expected to increase 3 more times in 2019 and once in 2020.