How high interest rates are already hitting Americans

foxbusiness.com:

Former Federal Reserve Governor Kevin Warsh provides insight on economic policies on 'Kudlow.'

The Federal Reserve paused its interest-rate hike campaign on Wednesday for the second time this year, but the highly anticipated decision may offer little reprieve to debt-ridden Americans squeezed by higher borrowing costs.

The widely expected decision Wednesday left interest rates unchanged at a range of 5.25% to 5.5%, the highest level since 2001. Policymakers also opened the door to another quarter-point increase – and indicated they will hold rates at those elevated levels for an extended period of time. 

That means credit card rates are likely to remain high, making it harder and more expensive for individuals trying to pay down their debt.

Average interest rates on credit cards have already surged from 16% in February 2022, before the Fed began hiking rates, to a new record of 20.71% as of Wednesday, according to a Bankrate database that goes back to 1985. The previous record was 19% in July 1991.

FED PAUSES RATE HIKES FOR SECOND TIME THIS YEAR, BUT HINTS AT ANOTHER INCREASE

Average interest rates on credit cards have surged from 16% in February 2022, before the Fed began hiking rates, to a new record of 20.71% as of Wednesday. (Photo Illustration by Roberto Machado Noa/LightRocket via / Getty Images)

For Americans who carry a balance from one month to the next, that quiet increase could be costing them hundreds – even thousands – of dollars.

«Whether the Fed does or doesn’t raise rates further in the coming months, the high rates are here to stay for awhile,» said Greg McBride, chief financial analyst at Bankrate. «The best steps for most households feeling the pinch of high prices and high interest rates are to pay