When interest rate cuts come, where will you feel them first?

The event Federal Reserve watchers have been waiting for this week is coming up Friday: Chair Jay Powell’s speech at the Jackson Hole Economic Policy Symposium in Wyoming — that’s the Kansas City Federal Reserve Bank’s big annual conference.

Economists, bankers and lots of other people in business and tech will be looking for signals in Powell’s speech about the Fed’s plans. Namely for interest rate cuts. 

It is looking increasingly likely that the Fed will start cutting rates next month. If and when that happens, how quickly — and where — would we, as consumers, feel it in our daily lives? 

Some interest rates have already come down, even though the Fed hasn’t announced a cut. But anticipation has something to do with it.

“The one that we’ve already seen the biggest move on is mortgage rates,” said Ted Rossman, a senior industry analyst at Bankrate. He said average rates on a 30-year fixed mortgage have dropped from around 8% in the fall to around 6.5% now. “That’s a meaningful change,” he said.

If you’re waiting for them to come down a lot more, don’t hold your breath, said David Beckworth, a senior research fellow at the Mercatus Center at George Mason University.

“At best, we’ll have some minor rate cuts, but we’ll definitely never return to the low rates of 2021, when many people got 3% mortgages,” he said.

Another place you may have noticed interest rates coming down — slightly — is on savings, like interest you can earn on certificates of deposit and high-yield savings accounts.

Sandi Bragar at the wealth management firm Aspiriant said after the Fed announces a cut, “the change in interest rates should impact those in a pretty quick manner. For any sort of savings account or money market account, unfortunately, you are going to see some decreases in interest rates.”

Likely within a month or so, she said. 

Other places you may notice a rate cut within a month or two? The interest you pay on your credit card debt and the rate you can get on a car loan or a home equity loan.

But Ted Rossman at Bankrate said in all of those cases, a quarter- or even a half-point cut won’t make that big a difference. 

“The Fed pushed rates higher by quite a bit, 5¼ points, and they did so aggressively. The ride down is likely to be slower,” he said.

That’s why borrowing costs — and interest you can get on savings — are likely to stay high for a while.