• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business

Global Inflation: Five ways US rate rise will affect you

3 years ago
in Business, Economy, Features, highlights, Home, home-news, latest News
4 min read
0 0
0
81
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

Global inflation: Five ways US rate rise will affect you

The US central bank has announced its biggest rate hike in nearly 30 years as it ramps up its battle to bring soaring consumer prices under control.

It lifted the rate the Federal Reserve charges banks to borrow by three quarters of a percentage point.

The consequences will be felt in nearly every corner of the economy – in the US and abroad.

Here are five ways the rate rise in the US will affect you.

More expensive mortgages and other loans

The immediate impact is in the US, where people will face higher borrowing costs for mortgages, credit cards, student loans and other debt.

The average rate on the popular 30-year fixed home loan has already surged to nearly 6% – its highest level since 2008. For the person buying a median-priced home in the US, that means monthly payments have gone up by about $600 since the start of the year.

RelatedPosts

Parliament Adjourns Sine Die After Intense Legislative Session Marked by Reform Calls and Tributes

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

“I wish I had started looking earlier,” says Delores Robinson, a retired educator from Ohio, who bought a new apartment this month.

Delores Robinson, centre,
Image caption,Delores Robinson, centre, saw borrowing costs rise during her housing search. “I wish I had started looking earlier” she says

Ms Robinson says she was relieved to lock in a relatively low rate, though it was higher than it was when she started her search. But for some buyers, the rising rates will push purchases out of reach.

The National Association of Realtors expects home sales in the US to fall 9% this year.

That drop might feel painful to people prevented from purchasing, but it is also expected to cool price growth to 5% in 2022, after double digit gains in recent years.

If that happens, it will help bring down inflation, a sign the Fed’s moves are working.

Smaller pensions and more expensive Uber rides

When rates lift off, it tends to prompt a dramatic reshuffling of investments. And with general economic concerns rising, those moves have been especially pronounced.

For those with money in the stock market, like people with 401k retirement accounts, that has meant seeing a sharp slide in the value of their investments.

The S&P 500 has sunk more than 20% since the start of January – a milestone known as a bear market – while the Nasdaq has shed nearly a third of its value.

Stocks tumbled as recession fears intensify
Image caption,Stocks tumbled as recession fears intensify

Risky assets, like cryptocurrencies, have seen their prices drop too, which stock exchanges outside the US have also been hit.

Investment firms are also pulling back from riskier ventures, demanding profitability from companies like Uber that have been operating at a loss for years.

That means people are likely to face higher prices for things like taxi rides and deliveries – or see such firms fold, as was the case for a number of start-ups that emerged in New York promising 15-minute groceries.

“In times of uncertainty, investors look for safety,” Uber boss Dara Khosrowshahi wrote in a letter to staff last month about the steps the firm would take to try to boost its bottom line, including slowing hiring. “It’s clear that the market is experiencing a seismic shift and we need to react accordingly.”

Job market slowdown and recession risk

As demand cools, it is putting an end to the booming post-pandemic labour market, which has seen companies competing fiercely for workers, allowing new hires to command higher pay and other perks and encouraging many to switch jobs for better.

Property giants Redfin and Compass this week announced plans to reduce their staffs by hundreds this week, citing the downturn and higher rates.

A slew of big companies like Uber, including Amazon, Walmart, Tesla and Spotify, have also announced plans to slow or halt hiring.

Amazon delivery worker
Image caption,Amazon is among the firms to slow hiring

The head of the US central bank, Jerome Powell, has said he is hopeful the economy will avoid mass job losses, noting that the US labour market remains very tight – with nearly double the openings to people hunting for positions.

But the economy was already facing challenges as inflation raises costs for companies and cuts into people’s spending power.

Growth already contracted in the first three months of the year. And while that was attributed to a quirk in international trade data, other indicators, like retail sales, have begun to darken.

As higher rates collide with a weakening economy, analysts say the bank risks bringing on a sustained slowdown, also known as a recession.

Stronger dollar

The US dollar has risen 10% this year, as the Fed’s moves prompting investors to shift money to America in pursuit of higher returns, boosting demand for its currency.

For Americans planning trips to places like the UK, where the value of a pound sank below $1.20 this week – its lowest since the pandemic – it’s a silver lining.

But elsewhere, the rise of the US currency means more expensive imports of commodities like energy and food, which often trade in dollars. That adds to economic strains, especially if a government holds a lot of debt in dollars.

Andrew Bailey
Image caption,The bank of England is one of the dozens of other central banks to announce rate rises in recent months

“Emerging markets tend to be the markets that really do stand to suffer the most,” says Fiona Cincotta, market analyst at City Index.

Higher rates abroad

Those dynamics mean the US is not hiking in a vacuum.

Dozens of other countries have also announced rate rises in recent months, including the Bank of England, Switzerland. Australia and Canada.

Many are fighting their own battles with inflation. But they are also taking cues from what’s happening in the world’s largest economy.

In countries like Kuwait and Saudi Arabia, where currencies are tied to the dollar, the impact of US rate rises is almost immediate, with banks hiking in lockstep, as they try to contain an outflow of funds to the US.

As those moves start to be felt on the ground, the economic story in the US will continue to be closely watched.

Tags: Federal ReserveGlobal inflation: Five ways US rate rise will affect youinflationUS central bank
No Result
View All Result

Highlights

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

Banking Sector Soundness Remains Robust in 2024 Amid Strong Profitability, Adequate Capital Buffers

Sha’Carri Richardson Withdraws from US Trials Following Arrest

From Singuluma to El Kaabi: Can CHAN 2024 Unleash the Next Hat-trick Hero?

Ghana to Welcome King’s Baton Relay on August 8 Ahead of 2026 Commonwealth Games

Trending

Features

Parliament Adjourns Sine Die After Intense Legislative Session Marked by Reform Calls and Tributes

August 2, 2025

Parliament Adjourns Sine Die After Intense Legislative Session Marked by Reform Calls and Tributes Parliament has adjourned...

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

August 2, 2025

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

August 2, 2025

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

August 2, 2025
Bank of Ghana

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

August 2, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.