The Fed’s Cure for Inflation Is a Major Punch in the Gut

If you think runaway inflation is brutal, wait until you get hit by the cure.

Last week the Federal Reserve raised the interest rate on money it lends to other banks by .75%, the biggest hike in three decades. Federal Reserve Chairman Jerome Powell said the hike is necessary to rein in skyrocketing inflation.

He’s planning more hikes in the coming months. They’ll lead to increased interest charges on credit cards and higher rates on home-equity loans, car loans and mortgages. It’s a punch in the gut for people who need to borrow.

Get ready for the interest rates on your credit cards to top a budget-busting 20% two monthly statements from now — up from a current average of 14.6%.

If you’re shopping for a home or a car, adjust your expectations downward. Whatever you thought you could afford, you’ll now be able to afford less because monthly payments will include significantly higher interest costs. (Read more from “The Fed’s Cure for Inflation Is a Major Punch in the Gut” HERE)

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