Fed increases interest rates by 75 basis points

Federal Reserve Chair Jerome Powell on Wednesday announced an interest rate hike of 75 basis points, continuing to aggressively combat the ongoing inflation.

The increase in rates—the fifth and not the last hike of the year—would likely impact several expenses like mortgage payments, credit cards, and cars. 

What to expect?
Mortgages: The interest rate hike influences many expenses, with mortgages witnessing the highest increase since 2008. The 30-year fixed-rate mortgage rose above 6% last week.

Credit cards: Credit card rates are closely linked to Fed rates and any rate hike would directly affect it. The average rate was 18.1% as of last week; credit card holders can expect the rise within one or two billing cycles.

Car loans: The increase in the price of cars can directly impact the loan rates, even though auto loans are fixed. People purchasing cars can expect a rate hike, as the average interest rate might rise above 6%.