The Fed cut interest rates March 17 by 75 basis points. The repeated rate reduction drove down prime lending rates to 5.25 percent. As predicted over the past two months, there’s a large possibility of more rate cuts in the future.
The impending recession and rising inflation make this an opportune time for small businesses to borrow money and acquire assets at a low price. The combination of higher inflation and low interest rates will lead to larger margins overall as wage inflation costs decrease.
Also, in this market environment small business owners can expect competition to wane, providing valuable growth opportunities. At the same time, businesses can keep fixed costs low to lower their leverage and increase their revenue streams to improve visibility.