Fed Minutes: They Do Not Rule Out Raising Rates If Inflation Does Not Ease

WHAT HAPPENED

The Fed kept its rate at 3.5%-3.75% annually by 9 votes to 3. Those three wanted to raise it by 0.25 points. Additionally, many officials said they could support a hike if inflation does not decrease.

WHY IT MATTERS

The market expected cuts, but the Fed keeps the door open to raising rates. This makes credit cards, mortgages, auto loans, and business loans more expensive; it impacts consumption and construction. A typical card in the U.S. already charges 20%-24% annually.

AND FOR YOUR PORTFOLIO

For a long-term portfolio, high rates often make financing more expensive and pressure companies that rely on borrowing or rapid growth. In contrast, savings and certificates of deposit may pay more. There is still no hike: it is a signal conditioned on inflation.