Macroeconomic data and policy statements are often Greek and Latin for ordinary people who tend to skip such news. But they should read this, given that a lot is at stake for them, financially speaking.
Let's take for instance the recent 25 basis point-interest rate hike by the US Federal Reserve on Wednesday. While the big picture can be left to market analysts and economists to decode, the immediate impact on consumers is always worth taking note of.
The Fed's decision is bound to hit American credit cardholders in a big way, according to an analyst at WalletHub that provides free credit scores and credit reports.
"With credit card debt steadily worsening, this latest increase will cost U.S. consumers roughly $1.6 billion in extra credit card finance charges during 2017," the Forbes quoted Jill Gonzalez, an analyst at WalletHub, as saying.
"This complicates an already bad situation for credit card users, considering that WalletHub expects outstanding balances to break the all-time record in 2017," he added.
The Statistica.com, in an update, said that there were an estimated 176 million credit card holders in the US at the end of 2015.
The hit would also extend to other categories of borrowers, the politico.com said, quoting an expert. Greg McBride, chief financial analyst Bankrate.com told the portal that this will increase borrowing costs for loans with floating interest rates such as loan taken against home equity, adjustable mortgages and variable rate student loan debt. The average rate on credit cards is around 16.5 percent, according to the portal.
The key interest rate after Wednesday's hike now ranges between 0.75 and 1 percent.
Stock market indices closed with minor gains on Wednesday; the Dow Jones Industrial Average ended 0.54 percent higher at 20,950, S&P 500 gained 0.84 percent to close at 2,385 and the Nasdaq inched 0.74 percent higher to end at 5,900.
Proving concerns that a rate hike would adversely affect Indian rupee and stock markets wrong, the domestic currency opened higher at 65.40 to the US dollar on Thursday, while the benchmark indices BSE Sensex and NSE Nifty also commenced trading on a bullish note.
The Sensex was up 135 points at 29,533, while the Nifty was trading 52 points higher at 9,137, an all-time high, at around 12.55 pm.
Top Sensex gainers were Adani Ports, Tata Steel, Asian Paints, NTPC and GAIL (India).
