As the Federal Reserve is anticipated to cut interest rates at its December policy meeting next week, LendingTree Chief Credit Analyst Matt Schulz joins Wealth to discuss the potential impact on retail credit cards and rates. Schulz explains that current Annual Percentage Rates (APRs) remain high due to the elevated risk for card issuers: "These stores want to be able to give these cards to anybody who walks up to the checkout counter. And when that’s the case, you’re basically taking on a bunch of risk, and whenever there’s a bunch of risk, one of the things banks do is raise interest rates on the cards." Despite high rates, Schulz suggests that consumers in 2025 are "a little more likely" to apply for store credit cards. "Some of that is just that people are looking for anything they can do to save and extend their holiday budgets," he tells Yahoo Finance.
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