Discussion Paper
The Effect of Fed Funds Rate Hikes on Consumer Borrowing Costs
Abstract: The target federal funds rate has hovered around zero for nearly a decade, and observers are questioning what effect an increase could have on both the financial markets and the real economy. In this post, we examine the historical reaction of loan rates to target rate increases. Specifically, we examine the interest rates that banks offer on residential mortgages and home equity lines of credit (HELOCs).
Keywords: Federal Funds; Consumer Lending; Monetary Policy; Taper Tantrum;
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Bibliographic Information
Provider: Federal Reserve Bank of New York
Part of Series: Liberty Street Economics
Publication Date: 2015-12-21
Number: 20151221