The impact of an increase in the federal interest rate, even by a quarter of a percentage point as expected, will affect just about every aspect of borrowing and spending in the Washington, D.C., region—and beyond.
“A rate hike, combined with the federal government’s hitting the debt ceiling tomorrow, will trigger higher interest rates. Those increases will increase the cost to purchase a home, expand a business or borrow,” said Frank Shafroth, director of George Mason University’s Center for State and Local Government Leadership at the Schar School of Policy and Government.
“It will increase the cost of borrowing, meaning there will be less ability to build new public infrastructure―such as public schools or enhancement at public universities, fixing Metro, or filling potholes left by this week’s freezing temperatures.”
The rate hike announcement is expected at 2:30 p.m. today.
Shafroth can be reached at fshafrot@gmu.edu or 703-993-8560.
For more information, contact Buzz McClain at 703-727-0230 or bmcclai2@gmu.edu.
About George Mason
George Mason University is Virginia’s largest public research university. Located near Washington, D.C., Mason enrolls 35,000 students from 130 countries and all 50 states. Mason has grown rapidly over the past half-century and is recognized for its innovation and entrepreneurship, remarkable diversity and commitment to accessibility.