The Fed indicated rates will remain higher for longer. What does that mean for you?

The Federal Reserve’s decision Wednesday to keep its benchmark rate at a two-decade high should have ripple effects across the economy. Mortgage rates, credit card rates, and auto loan rates will all likely maintain their highs, with consequences for consumer spending. The Fed has indicated it doesn’t plan to cut interest rates until it has “greater confidence” that price increases are slowing to its 2% target. The central bank kept its key rate at roughly 5.3%, where it has been since last August. While inflation has cooled from a peak of 7.1% to 2.7%, average prices remain well above pre-pandemic levels.