America In Focus: Affordability Concerns Rise as Fed Hikes Key Rate, Mortgage Rate Reaches Nearly 7%
The quarter-point increase lifts the Fed’s key rate to about 3.9% as mortgage rates rise to 6.95%, Freddie Mac said.
- The Federal Reserve raised its benchmark interest rate to about 3.9% on Wednesday, marking the first increase since 2023 to combat stubbornly high inflation. Officials signaled a potential second rate hike later this year to 4.1%.
- Americans continue struggling with high costs for groceries, gas, and housing, prompting the central bank's action. The rate increase could eventually raise borrowing costs for mortgages, auto loans, and credit cards.
- Mortgage buyer Freddie Mac reported Thursday that the benchmark 30-year fixed-rate home loan rose to 6.95%, climbing just below 7%—its highest level in over 19 months. This marks the fourth consecutive week of rate increases.
- Retail sales rose 1.2% in August, exceeding economist expectations of a 0.7% gain, according to Commerce Department data released Wednesday. Excluding gas stations, retail sales grew 1.1% during the month.
- Jobless claims slid to 196,000 last week, the fewest since mid-July, according to the Labor Department. For the past year, claims have remained within a historically low range of 200,000 to 230,000 weekly.
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America In Focus: Affordability concerns rise as Fed hikes key rate, mortgage rate reaches nearly 7% - Regional Media News
The economy, inflation and how those forces could impact the lives of Americans were front and center over the past week. Trips to the grocery store and gas station are more painful than they were last year, and rising costs are impacting the decisions of [...]
Ottumwa Courier
America In Focus: Affordability concerns rise as Fed hikes key rate, mortgage rate reaches nearly 7%
The Federal Reserve raised its benchmark interest rate Wednesday for the first time since 2023 in an effort to quell stubbornly high inflation, and the central bank signaled another rate hike could occur later this year. The quarter-point increase lifts…
Economist: Fed rate hike will not curb US inflation
Much of US inflation is supply-driven, raising questions over how much higher rates can actually achieve. Liang Yan, Kremer Chair Professor of Economics at Willamette University, says further tightening could add pressure to an already struggling housing
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