The Fed's only real weapon against inflation is raising borrowing costs. The goal is to restrict money supply and credit within the economy. Raising rates at their current aggressive pace also has the end goal of slowing the economy by slowing demand thus quickly slowing the rate of inflation. Well, the Fed's efforts are being seen in small businesses across the country. While cost of business remains high, higher interest rates restrict small business ability to grow and even maintain business. Business owners are delaying investments that could open up new markets, the higher costs of borrowing are compounding to the already rising costs of business expenses, and in some cases the monetary tightening is cutting on revenue. These are storms large corporations can maneuver. But the small business of the country will be largely affected as rates continue rise while warnings of a recession loom.


Rising Interest Rates Put Small Business Owners’ Plans on Hold