Double-Edged Sword: Interest rate hikes could help bring down food prices
It is a double-edged sword - rising interest rates are contributing to family and farmer financial challenges right now, but they could actually help bring down the cost of some things in the long run.
USDA Economist Matt MacLachlan says since interest rate hikes reduce the money supply and reduce demand, he expects that will in turn slow price increases, maybe even bring them down. Right now, food prices are running 12 percent higher than this time last year.
We will be watching the price index closely to see if the Fed’s most recent interest increase does in fact provide relief at the grocery store.
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What could be the effects of rising interest rates on agriculture?