Fed official Loretta Mester raises long-term interest rate prediction due to US economy strength, which may increase borrowing costs.

Federal Reserve official Loretta Mester has increased her prediction for long-term interest rates due to the US economy's sustained strength. With the Fed's key lending rate at a 23-year high of 5.25-5.50%, aiming to control inflation, Mester raised her forecast for the equilibrium interest rate to 3.0%. This could lead to higher borrowing costs for consumers and businesses, making it more challenging for Americans to repay mortgages and car loans.

April 02, 2024
8 Articles