(WXYZ) — The Federal Reserve will meet on Wednesday to discuss interest rates.
Since the start of the pandemic, interest rates have been kept at zero to help boost job growth and help businesses borrow.
Today, interest rates are expected to rise for the first time since 2018. It is projected that interest rates will rise a quarter-point.
The goal in raising rates is to curb the sky-high prices we’re seeing on grocery store shelves and at the pump.
It won’t be a quick fix, but over time it’s expected to help ease inflation.
“If interest rates continue to go at a quarter-point all seven times this year, it would only be two percent," University of Michigan Economist Richard Curtin said. "It will take a considerable amount of time for the fed to get interest rates high enough to curb the current inflation rate.”
The latest numbers show that the price for consumer goods was up nearly 8% year-over-year. Energy costs surged nearly 26%.
Curtin warns that inflation could keep rising this year, possibly reaching 10%. It wouldn’t be the first time it’s happened, but it doesn’t lessen the sting for everyday people.
Mat Ishbia, the President and CEO of United Wholesale Mortgage says people looking to buy a home in the near future could actually benefit from Wednesday's news in the short term.
Even though a rate hike would make it more expensive to borrow. Fed rate expectations he says… have already impacted mortgage rates.
"Just because the fed is raising rates, it doesn't mean it is going to go up or the next day. There is a good chance rates actually go down tomorrow," he said.