Even though the Federal Reserve didn’t raise its benchmark rate Wednesday, the days of low rates are clearly numbered.
Reports of hotter-than-anticipated inflation have paved the way for the central bank to unwind last year’s bond buying. While the Fed said that interest rates will stay near zero for now, the tapering of bond purchases is seen as the first step on the way to interest-rate hikes.
That will inevitably impact the rates consumers pay.
In fact, rates are already rising for long-term borrowing costs, said Yiming Ma, an assistant finance professor at Columbia University Business School. “Likely that’s going to continue as the implementation starts actually happening.”