Borrowing costs for consumers have risen as the Federal Reserve continues to tighten monetary policy, with interest rates on home, auto and credit-card loans reaching multiyear highs in recent months, the Wall Street Journal reported. Rates on mortgages, which account for the biggest chunk of U.S. household borrowing, are at their highest levels since 2013. According to Freddie Mac, the average fixed rate on a 30-year mortgage was 4.54 percent last week, up from 3.95 percent in early January. Though rates are still moderate by historical standards, that increase is enough to add about $100 to the monthly mortgage on an average-priced home in the U.S. with a 20 percent down payment. So far, there is little sign that higher interest rates are damping consumer spending, which handily beat economists’ expectations in April even after the Fed raised its benchmark federal-funds rate in March to a range between 1.50 percent and 1.75 percent. The central bank is likely to announce another quarter-percentage-point increase today and pencil in at least one more move this year.
