Here's What the Fed's Interest Rate Hike Means for Costco, Walmart, and Target (and My Top Pick to Buy Now)
These companies depend on consumer spending.
Overview
The Federal Reserve recently did something it hasn't done for three years: It raised interest rates. In his first big policy shift as Fed chair, Kevin Warsh, who took the post in May, said, "inflation is too high and has been for too long." The move, a quarter-point increase to the range of 3.75% to 4%, followed Warsh's decision to maintain rates at the current level during June and July policy meetings.
Though President Donald Trump has pushed for lower interest rates, in recent months, economists' expectations for a rate hike gradually increased amid higher inflation -- this could be seen from prices at the pump to food costs at the supermarket. Lifting rates is meant to put the brakes on rising inflation and the broadening of price increases across the economy. Rate increases do this by prompting individuals to save rather than spend.
Details
With this in mind, let's check out what the Fed's interest rate hike means for certain top consumer-related stocks such as Costco Wholesale (NASDAQ: COST), Walmart (NASDAQ: WMT), and Target (NYSE: TGT), as well as my top pick to buy now...
Source
Originally published at www.fool.com.