Inflation is at its highest level in the last 40 years. Consumer Price Index (CPI) reached 9.1% in June 2022.
The FED has started to increase interest rates aggressively. Since March 2022, Central Bank has hiked interest rates by 225 basis points.
The higher borrowing cost will reduce the liquidity in the market. Companies having huge debt will suffer the most.
Equity is less attractive and investors shifts towards the bond market and other interest rate products.
There is a bloodbath in Crypto Market. Most (Memecoins/Low Price) Cryptocurrencies have fallen by more than 90%.
Many coins will never recover and Investors face huge losses. The quality currencies will take much longer time than expected.
Fed Rate hikes increases the cost of all the financing products. This means now you will pay more interest for Credit.
The rising interest rates affect housing market as the cost of credit rises. After the rate hikes, the 30-year Mortgage rates are ranging near 5.5%
Rising rates make homes more expensive for buyers, thereby reducing the demand for home purchases which affects the price.
Fed’s rate hikes will reduce the profits of companies in two ways - An increase in borrowing costs and demand Shrink.
It's tuff time for companies to maintain their profits. For that companies cut many jobs and it will be hard to find new jobs.