That of the Federal Reserve sharpest rise in interest rates two decades from now is poised to hit black consumers hard, economists say. The half-percentage-point hike will empty wallets in the form of higher interest on credit cards, business and personal loans, and mortgages for everyone, but it could do the most damage to consumers. black people who the government has already acknowledged are on the wrong side of post-pandemic economic recovery.

“What we’re seeing is a lot of shocks in the economy all at once,” said Keisha Blair, an economist who studies the impact of public policies on marginalized communities. In his book, “Holistic Wealth,” Blair talks about a “lost decade” between the end of the last recession in 2009 and the pre-pandemic year of 2019, when the broader economy grew significantly but black workers have not seen their wages, home values, net worth, or borrowing power increase nearly as much as whites.

“And then we didn’t have a war in Ukraine, we didn’t have these interest rate hikes,” she said. “For black communities, it will be much worse.

Blair’s fears match concerns the federal government already had. The Biden administration rolled out last month a multitude of initiatives aimed at addressing systemic racial inequalities that have been reinforced by public policies across government. Many of these initiatives have a direct or indirect impact on economic issues affecting Black and Hispanic people and women of all ethnicities.

The Fed, which sets interest rates, said in 2020 that he was concerned about the impact of the measures he would take to keep the economy stable after the pandemic on black communities. New data, that I talked about in March, have already shown that some of the Fed’s actions, including past rate hikes, could already be widening the race-wealth gap. And that’s not counting the impact that soaring stock and house prices over the past decade already had.

The Fed’s rate hike is intended to reduce inflation – the overall rise in the cost of goods – by making it more expensive for banks, businesses and consumers to borrow money, thereby decreasing demand. That way, Wednesday’s rate hike will hurt all consumers, Blair said, but it’s likely to have particularly bad and complex outcomes for black consumers.

As a group, black consumers have lower incomes, less money saved and fewer assets like stock portfolios and retirement accounts, she said. If higher interest rates push the economy into a recession, it makes it harder for people on the margins of the economy to survive.

“People who are really short of money, this situation with interest rates is going to have a big impact on them. It will be more difficult if they need to borrow money just to pay their bills. If they’re thinking about going back to school to get a better paying job, they’re going to be stuck in. You’re going to see all kinds of effects, from homelessness to higher unemployment,” Blair said.

But not all black consumers are low-income, and even those in the middle class have already struggled in the housing market, which is directly impacted by interest rates. For example, Wells Fargo, the nation’s third largest commercial bank, refused more than half of mortgage refinance applications it received from black consumers in 2020. Higher interest rates are making it even more difficult for current homeowners to refinance and could make homeownership completely out of reach for those who have saved for a home but don’t already own one.

“All sorts of variables are going to come into play,” Blair said. “Long-term goals will be impacted. It looks like fewer opportunities will be available.