The Fed’s recent interest rate hike will impact the U.S. job market, affecting 70% of homeowners’ mortgage repayments

The Federal Reserve announced on the 26th that it would raise interest rates by another 25 basis points, raising the target range of the federal funds rate to between 5.25% and 5.5%, reaching the highest level in 22 years. David Tavel, co-founder of ProChain Capital, an American hedge fund company and a financial expert, said that the Fed is putting Americans out of work and reducing demand for commodities by curbing consumption. Tavel said that the inflation rate in the United States rose during the epidemic, and the U.S. government continued to print money and provide various loans and subsidies to companies in the following 18 months, which led to a consumption frenzy and eventually pushed up prices, leading to further inflation. The Fed is mechanically raising interest rates in an attempt to curb inflation.

Tawil said the Fed’s goal of raising interest rates is to increase the unemployment rate, which may keep the unemployment rate at 4% to 5%. Unemployment pain will be widespread as up to 70% of homeowners are still paying their mortgages, Tawil said. Tavel explained that interest rates in the U.S. used to be low, 2% and 3%, and people didn’t feel pressured to take out a 30-year home loan or whatever was left on the loan; if those people were going to buy a home now, they would have to borrow more to do At this point, the loan interest rate may reach 7%-8%, “in terms of the monthly repayment of the same amount of loans, this is a huge difference.”

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