Arabic version: ارتفاع أسعار الفائدة لدى الاحتياطي الفيدرالي قد يخفف ضغوط التضخم

According to Cnbc, consumers facing high borrowing costs could ultimately benefit if the Federal Reserve keeps monetary policy restrictive or raises rates at its Sept. 15-16 meeting. The Trump administration has urged the central bank not to raise rates and has called for lower borrowing costs, but experts cited by CNBC warned that easing too soon could hinder efforts to bring inflation under control.

The Fed has held rates steady throughout the year while inflation has remained above its 2% target. Investors were pricing in a 60% chance of a quarter-percentage-point increase at the September meeting, based on the CME Group’s FedWatch tool. A rate increase would make products such as auto loans, credit-card debt and mortgages more expensive, adding to existing affordability pressures.

However, higher rates can restrain spending and borrowing, cooling the economy and reducing inflationary pressure on household staples including groceries and gasoline. Mark Higgins, senior vice president at Index Fund Advisors, said restrictive policy should remain in place until inflation is decisively controlled. He said a rate hike would send a clear message after a prolonged inflation episode.

Mark Zandi, chief economist at Moody’s, said presidential pressure for rate cuts could be counterproductive by driving longer-term rates higher. The 10-year Treasury yield briefly exceeded 4.8% on Tuesday as oil prices added to inflation concerns, while the average 30-year fixed mortgage rate reached 6.89%, according to Mortgage News Daily. Mark Hamrick, founder of The Hamrick Brief, said preserving the Fed’s independence is important to maintaining public confidence that it can restore price stability.