NASHVILLE, Tenn. (WTVF) — As the Federal Reserve hiked interest rates up another 0.75% Wednesday, it's leaving many wondering if we are headed toward a recession that could force more Tennesseans out of work.
Andy Borchers with the Lipscomb University College of Business says the previous interest rate hike back in June has already cooled the economy some.
"For example, with the mortgage rates up some housing markets are beginning to cool down," Borchers said.
While many suspect the U.S. may already be in a recession, it's not official yet — with only one reported quarter of negative economic growth, instead of the required two, but that data lags behind.
But experts say if we are headed that way, it may not be that bad in Middle Tennessee.
"The fact that labor markets right now are still very strong is a positive indication that even if there is a recession it may be relatively modest," Borchers said.
In the meantime, higher interest rates mean it will be more expensive to borrow money — meaning you'll pay more on your credit cards if you carry a balance.
The group Greater Nashville Realtors says the higher rates have dropped the number of home closings, meaning buyers may now have more time to negotiate for things like repairs and closing costs.
"I think it's healthy for the market transitioning away from a strong seller's market to a more balanced market where neither buyers nor sellers have the upper hand," said Steve Jolly with Greater Nashville Realtors.
It's perhaps at least one benefit during this hot Summer as our economy's cooling systems still seem to be hard at work.