America’s Small Businesses Need Relief From High Interest Rates
The Federal Reserve sets the interest rate that banks pay when borrowing money from other banks. This “federal funds rate” currently sits at 4.5 percent. The tool helps the Federal Reserve control inflation but can be a double-edged sword. High interest rates can help to temper quickly increasing prices that harm consumers and small businesses, but it can also slow the economy.
The delicate balancing act is currently out of whack. Despite the inflation rate moderating during the first six months of the second Trump administration, Chairman Jerome Powell has refused to lower interest rates. Read a recent op-ed on the topic from Job Creators Network CEO, Alfredo Ortiz, here.
See how inflation has come to heel under Trump and how U.S. interest rates stack-up against other countries below:
As a result of the high interest rates in the U.S., small businesses are having a difficult time accessing lines of credit to expand operations, which is throwing cold water on the economy. The Federal Reserve needs to hear the urgent call from America’s small businesses community.
“I have been turned down by several small to mid-sized banks,” said Gerald Williams, a California hot-sauce entrepreneur, who was looking for a $50,000 loan to grow his business and buy a commercial kitchen. “The process of looking for a loan has been so frustrating that I have just given up on it,” said Shantell Chambliss, a Virginia small business owner who had been trying to get a $25,000 loan.