The Federal Reserve held interest rates steady last week, so why aren’t credit card, auto loan, and mortgage rates coming down? On this episode of Everyday Economics, Center Square publisher Chris Krug and chief economist Dr. Orphe Divounguy explain why the Fed can make money expensive but can’t create workers, oil, or cheaper imports.

Dr. O breaks down why the Fed’s 3.75% to 4% target range doesn’t set the rates households pay, and why rising long-term Treasury yields matter more for your borrowing costs. They also dig into whether the AI investment boom is a bubble, with data center construction up about 25% while factory construction falls nearly 20%, and why productivity growth of 2.2% is barely above its long-run average of 2.1%.

Ahead of Friday’s October jobs report, Dr. O explains why a consensus forecast of 55,000 jobs is roughly break-even in an economy with almost no labor force growth, and what that means for unemployment, wages, and the Fed. Finally, they look at how an aging America could squeeze state budgets with slower income tax growth and rising Medicaid long-term care costs.

Read Dr. O’s full column at The Center Square.

#Economy #FederalReserve #InterestRates #JobsReport #AI #Inflation #EverydayEconomics #TheCenterSquare

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