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Tuesday’s hike in federal interest rates -- the fourteenth straight hike from the Federal Reserve -- helped push the average credit card interest rate past the 13 percent mark, according to the weekly IndexCreditCards.com Credit Card Monitor.

Cleveland, OH (PRWEB) February 2, 2006 -- Tuesday’s hike in federal interest rates -- the fourteenth straight hike from the Federal Reserve -- helped push the average credit card interest rate past the 13 percent mark, according to the weekly IndexCreditCards.com Credit Card Monitor. Major credit card issuers including Bank of America, Citibank, National City, US Bancorp and Wells Fargo announced increases in their lending rates in response to the Fed hike, meaning another quarter-point bump for holders of these issuers’ variable-rate credit cards.

Variable-rate credit cards offer interest rates based on a formula that includes a base rate plus a percentage tied to federal lending rates. When federal rates move up, credit card rates follow.

The average credit card rate for standard, non-reward credit cards jumped to 13.02% this week, while the rate for credit cards offering rewards passed the 14 percent mark, to 14.09%. The news is better for consumers with the very best credit -- for them, these averages are 10.28% and 11.61%, respectively.

As always, college students who carry balances are paying more. The average APR for a student credit card moved to 15.59% this week.

For the first time in five weeks, the average business credit card rate also increased. However, the rise was slight, and business card rates remained far below consumer rates. Standard business credit cards offered an average APR of 11.37%, while business reward credit cards offered an average rate of 13.22%.

“It’s unclear whether the Fed hikes are over,” says Justin McHenry, Research Director for IndexCreditCards.com. “With Ben Bernanke officially taking over for Alan Greenspan as Federal Reserve chairman, predictions are varied as to his philosophy. However, most experts think we’ll see at least one more quarter-point hike in March, so if you’re carrying a variable-rate credit card, now’s the time to get it paid off.”

Financial institutions represented in the survey include Advanta, American Express, Bank of America, Capital One, Chase, Citi, Discover, MBNA, National City, Providian, Pulaski Bank, U.S. Bank, Wachovia, Wells Fargo and more.

About IndexCreditCards.com
IndexCreditCards.com offers credit card news, research, and perhaps the most comprehensive index of credit cards available on the Internet today, with a master listing of over 700 credit cards as well as categorized lists based on interest rates, reward programs, business credit cards, student credit cards and credit cards for those with poor credit histories.

Credit Card Monitor is a weekly survey tracking average credit card rates in multiple card categories. Credit Card Monitor information provided in this release may be reproduced free of charge, provided credit is given to http://www.IndexCreditCards.com.

Contact: Justin McHenry, 216.221.0312, j.mchenry @ indexcreditcards.com

Website: http://www.IndexCreditCards.com



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Yes, low APR credit cards are on the rise. Many credit cards are competing for your business to give you the best and lowest rates available today. There are so many credit cards from you to choose from that they are doing all kinds of things to get your attention including lowering their interest rate and giving you no annual fees.

Why is this happening? Because there are so many credit card companies. They all want your business and this is an attractive incentive to get you to apply and own one of their credit cards. If you choose a low APR credit card over one with 19.99 percent you are sure to go with the lower APR.

The only problem is that sometime these 0% and low APR credit cards are only promotional ways to get you to apply and then later your interest rate will rise. Many credit card companies have low APR credit cards for a certain amount of time such as 3 months, 6 months and some up to one year. You will have to compare to find out which one keeps the lower APR after the promotional period to ensure you are getting the best deal around.

No matter what the reason low APR credit cards are here to stay as long as the companies are competing for your business. Just remember to compare everything they offer besides the lower interest rate. You may find that several credit card companies are now offering other wonderful incentives for you to apply with them such as reward programs.

No matter which company you choose, you will enjoy the low APR credit cards even if it is only for a limited time. You will be able to save money on your purchases because you will not have to pay any interest until the promotional period is over. Just be sure your balance is very low when the interest rate kicks in and you will be fine.