Another federal interest rate hike could have you paying more if you borrow

CHARLOTTE — On Wednesday, a major decision will be made affecting your money.

The Federal Reserve is expected to raise interest rates again, just six weeks after it made a similar increase.

That means it’ll cost more to borrow money. You’ll pay more on things like your credit card debt or loans for a car or home.

The increase is expected to be .75 percentage points– the same amount as the federal rate raise from last month.

It may not sound like a big bump, but it’ll have a significant impact.

For an average credit card with a balance of about $5,000, Wednesday’s expected hike would cost an extra $283 in interest before the bill is paid off.

Payments will also be higher for folks looking to borrow money to buy a house or car. The jump will only impact people purchasing after the rate is raised.

This is the fourth rate hike this year as U.S. economic leaders attempt to stop rising costs that are plaguing almost everything from gas to groceries.

The goal is to slow the economy down by making borrowing more expensive, which should bring down inflation.

There are signs the previous efforts are having an impact.

Walmart cut its profit, outlook citing less spending from customers. Prices for air travel are also dropping significantly and so is the cost of a gallon of gas at the pump.

Gas is nearly 60 cents cheaper in both North Carolina and South Carolina than it was a month ago.

“I think this is wonderful, this is what we’ve been looking for, a little relief in our life,” one person told Channel 9.

On Thursday, a new report from the Biden Administration will show if the U.S. saw two quarters in a row of negative gross domestic product growth — a standard definition of a recession.

Still, the White House has rejected that idea.

“I think the state of the economy is demonstrating resilience in the face of very significant global economic challenges,” said Brian Deese, director of the National Economic Council.

(WATCH BELOW: Federal student loan interest rates to increase on July 1)

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