Fed expected to hike interest rates for first time since 2023. See what it means for your money.

Key Points:

• The Federal Reserve is expected to raise its benchmark interest rate by 0.25 percentage points on Sept. 16, marking the first hike in over three years, as it aims to combat persistent inflation driven by high energy prices.
• Inflation remains above the Fed's 2% target, with the Consumer Price Index rising 3.4% annually in August, and some economists anticipate additional rate hikes if energy prices stay elevated due to ongoing geopolitical tensions.
• A rate increase would likely lead to higher borrowing costs for consumers, including credit card interest rates, though the immediate impact on monthly payments may be modest; mortgage rates could stabilize or decrease due to bond market dynamics.
• Savers stand to benefit from higher interest rates through improved returns on high-yield savings accounts and certificates of deposit, while investors may experience market volatility but are advised to maintain diversified portfolios and avoid reacting to short-term news.
• The Fed's decision and economic projections will be announced at 2 p.m. ET on Sept. 16, followed by a press conference from Fed Chairman Kevin Warsh, providing insight into the central bank's outlook on inflation, growth, and monetary policy.