Sky-high household debt acquired during a period of low interest rates now needs refinancing at much higher rates. The table shows outstanding debt for several categories of mortgage and non-mortgage debt, interest paid and a projection of additional interest costs at the full four percentage point interest rate hike. Credit card rates are an exception, as they generally have fixed (albeit very high) interest rates. Some debt is retired each year, and higher rates may push some to retire debt early before getting hit by higher rates. Higher interest rates represent a windfall for the banks and show that high interest rates are good for the rentier class that makes its profits lending money.

Source: CBC News December 07, 2022 15:40 UTC