Credit Card Interest Rates - Higher or Lower from Here?

There was an article in Marketwatch a couple of days ago discussing how interest rates on credit cards haven’t declined as fast as the Federal Reserve has cut its target rate.  One commentator in the article suggested that credit card rates would edge up by the end of the year. That’s not surprising, as even though the average interest rate on all credit cards might be going down, there’s plenty of anecdotal evidence by individual consumers who are seeing increased interest rates.

I think there are a number of factors that could lead interest rates on credit cards either higher or lower right now.  If the credit crisis begins to ease, or the economy is not as bad as people fear it will be in 2009, or the government is able to pass a sufficient economic stimulus package, or additional troubled mortgage relief, then it seems like rates should drop.  But either the pending 2010 federal reserve credit card regulations or the bad financial position of consumers in general could work to increase interest rates on average.  As unpopular as it might be, banks might decide to increase interest rates and fees simply to cover some of their losses from the credit crisis, while strengthening their financial position.

Because it seems like an important point, and one that plays a roll on how Congress should act with respect to additional regulation of the credit card industry, I’ve decided to conduct a poll:

[poll id="1"]

The poll will be closed on March 1, 2009.

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