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Fed raises interest rates, what will be more expensive


To reduce persistently high inflation, the Federal Reserve announced a third consecutive “jumbo” interest hike of 0.75% Wednesday, further increasing the cost of debt for credit cards, vehicle financing and other loans.

The fifth-straight increase to the federal funds rate brings it to a range of 3% to 3.25%, the highest it’s been since 2008. Typically, rate increases come in 0.25% increments, but the Fed has been using supersized hikes to curb the rate of inflation, which is currently up 8.3% year over year — well above its benchmark target of 2%.

By increasing its key interest rate, the central bank discourages spending, which can reduce inflation for the prices for goods and services. However, the downside to each rate hike is increased monthly debt costs for Americans. 

Here are four things that will likely get more expensive.

1. Credit cards

2. Auto financing

3. Mortgages

4. Other variable-rate loans

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