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Americans could pay $2.2 billion more on their credit-card debt after Fed rate hike

“Consumers with credit-card debt will likely pay an additional $2.2 billion in interest payments annually, according to an analysis from the credit-card website CompareCards.com” writes Maria Lamagna for marketwatch.com. Credit-card interest rates are variable and tied to the prime rate, an index a few percentage points above the federal funds rate.The Federal Reserve on Wednesday raised its benchmark federal funds rate by a quarter-percentage point — to a range of 1.75% to 2% — as many economists had expected.If you have credit-card debt, it just got a little more expensive.The Fed raises and lowers interest rates in an attempt to control inflation.
 
Source: marketwatch.com



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