Ahead of next week\u2019s\u00a0Federal Reserve<\/a>\u00a0meeting, relations between President\u00a0Donald Trump<\/a> and Fed Chair Jerome Powell<\/a> have hit a low<\/a>.<\/p>\n \u201cFamilies are being hurt because Interest Rates are too high,\u201d Trump wrote in a\u00a0Truth Social<\/a>\u00a0post on Wednesday.<\/p>\n Trump has said he wants the Fed to sharply lower interest rates by as much as 3 percentage points to spur economic growth. (Although the central bank typically adjusts its benchmark in 25-basis-point increments<\/a>, rates were slashed to near zero as recently as the Covid pandemic. \u201cThe Fed only resorts to such extreme measures in response to severe economic distress,\u201d said Greg McBride, chief financial analyst at Bankrate.)<\/p>\n The president has argued that maintaining a federal funds rate that is too high makes it harder for businesses and consumers to borrow and puts the U.S. at an economic disadvantage to countries with lower rates.<\/p>\n The Fed\u2019s benchmark sets what banks charge each other for overnight lending, but also has a trickle-down effect on almost all of the\u00a0borrowing and savings rates<\/a>\u00a0Americans see every day.<\/p>\n More from Personal Finance:<\/strong> Powell said earlier this month that the Fed likely\u00a0would have cut rates by now<\/a>, but that it has held off due to the uncertainty and inflation risks posed by Trump\u2019s tariff agenda. Many economists say that the full impact from tariffs on pricing has only just started to be felt, and inflation could pick up in the second half of the year.<\/p>\n Since December, the federal funds rate has remained steady in a target range of 4.25% to 4.5%. Futures market pricing is implying\u00a0almost no chance of an interest rate cut\u00a0when the Fed meets next week, according to the CME Group\u2019s FedWatch<\/a>\u00a0gauge. Market pricing indicates the Fed is much more likely to consider a rate cut in September.<\/p>\n Once the fed funds rate comes down, consumers could see their borrowing costs\u00a0start to fall as well<\/a>.<\/p>\n However, \u201cthere is no guarantee this would translate into lower rates,\u201d said Brett House, an economics professor at Columbia Business School \u2014 \u201clargely because many types of borrowing, mortgage rates specifically, are not benchmarked off the Fed.\u201d<\/p>\n From mortgage rates and auto loans to credit cards and savings accounts,\u00a0here\u2019s a look at how the Fed affects your finances.<\/p>\n<\/div>\n Trump said in a July 23 social media post<\/a> that \u201cHousing in our Country is lagging because Jerome \u2018Too Late\u2019 Powell refuses to lower Interest Rates.\u201d<\/p>\n But fixed mortgage rates<\/a>, specifically, don\u2019t directly track the Fed: They are largely tied to Treasury yields and the U.S. economy.\u00a0As concerns over tariffs and the broader economy drive Treasury yields higher,\u00a0mortgage rates also remain stubbornly high.<\/p>\n<\/div>\n The average rate for a 30-year, fixed-rate mortgage is\u00a0currently near 6.8%, according to Bankrate. The nationwide problem of limited inventory and housing affordability<\/a>\u00a0is a key issue, regardless of the Fed\u2019s next move.<\/p>\n The housing market \u201ccontinues to struggle under high home prices as well as high mortgage rates,\u201d Eugenio\u00a0Aleman, chief economist\u00a0at Raymond James, said in a statement. The median price of a home sold hit a record high<\/a> in June, according to recent data.<\/p>\n<\/div>\n Most\u00a0credit cards<\/a>\u00a0have a variable rate, so there\u2019s a more direct connection to the Fed\u2019s benchmark.<\/p>\n Yet, regardless of the central bank\u2019s next move, credit card rates are high and likely to stay there. The\u00a0average annual percentage rate is currently just over 20%, according to Bankrate, not far from last year\u2019s all-time record<\/a>.\u00a0<\/p>\n<\/div>\n \u201cCredit card rates have been in a holding pattern at a very elevated level,\u201d McBride said.<\/p>\n Even if APRs were 3 percentage points lower, that would not significantly ease the burden of a revolving balance, most experts say.<\/p>\n<\/div>\n Auto loan rates<\/a>\u00a0are fixed for the life of the loan. Payments keep getting bigger because\u00a0car prices<\/a>\u00a0are rising, in addition to pressure from Trump\u2019s\u00a0plan to impose higher tariffs<\/a> on foreign-made vehicles and car parts.<\/p>\n Currently, the average rate on a five-year new car loan is 7.22%, according to Bankrate.<\/p>\n \u201cConsumers are continuously stretching to afford new vehicles in this market,\u201d said Ivan Drury, Edmunds\u2019 director of insights. Now, the share of new-car buyers with a car payment of\u00a0more than $1,000 a month<\/a> is at all-time high.<\/p>\n<\/div>\n On the upside, top-yielding online\u00a0savings<\/a>\u00a0accounts still offer above-average returns and currently pay more than 4%, according to Bankrate.<\/p>\n While the central bank has no\u00a0direct influence\u00a0on deposit rates, the yields tend to be correlated to changes in the target federal funds rate \u2014 so holding that rate unchanged has kept savings rates above the rate of inflation, which is considered a rare win.<\/p>\n \u201cIt\u2019s not a good time to be a borrower, but it\u2019s a great time to be a saver \u2014 lean into that,\u201d said Bankrate\u2019s McBride.<\/p>\n Subscribe to CNBC on YouTube.<\/strong><\/em><\/a><\/p>\n<\/div>\n<\/div>\n\n
Trump\u2019s \u2018big beautiful bill\u2019 slashes CFPB funding<\/a>
78% say Trump\u2019s tariffs will make it harder to deal with debt<\/a>
Tax changes under Trump\u2019s \u2018big beautiful bill\u2019 \u2014 in one chart<\/a><\/p>\nMortgages<\/h2>\n
![\"Housing](\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/108173849-17528406391752840634-40776962421-1080pnbcnews.jpg?v=1752840638&w=750&h=422&vtcrop=y\")
Credit cards<\/h2>\n
Auto loans<\/h2>\n
Student loans<\/h2>\n
Savings<\/h2>\n
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