Opening Cafe Latino has been a lifelong dream for longtime Westchester residents Maria and Jose Mercado - just not under this current economic climate.

"It's definitely a little anxiety-inducing," says Josephine Mercado, Maria, and Jose's daughter, who co-owns the restaurant with her parents.

The Mexican/Dominican fusion restaurant officially opened its doors last month in the middle of the worst inflation in the U.S. in over four decades and despite business being good so far it has been a challenge.

"Everyone's hurting right now," says Mercado.

Fortunately, they were not hit hard by rising interest rates when they secured their Fifth Avenue storefront in Pelham but other economic factors have been impacting their business.

They worry about rent rising, the cost of food has cut into their profit margins, and they have already cut back on operating hours. 

"Our utilities alone were costing us more than we were generating in sales," says Mercado.

They are a resilient family, but the path forward is as unstable as the country's economic future and the two are vastly intertwined.

On Wednesday, the feds raised interest rates three-quarters of a percent hoping to combat out-of-control inflation.

"Your borrowing costs essentially increase, and they are now increasing rather significantly," says John Tolomer, Valley Bank Market President.

Officials hope this discourages unnecessary spending and while it is the most aggressive push by the feds in years, the payoff is unclear.

"This should tamper demand and give the supply chain more time to react and be more effective," says Tolomer.

For the Mercados, they hope this means the cost of ingredients goes back down because they've stayed committed to not raising menu prices even at the expense of a few extra dollars per order.

"The whole point is to keep it accessible and to keep it accommodating the fact that we're in a really diverse area," says Mercado.

But some experts fear the economy could swing the other way. Creating an environment where people don't have enough disposable income to spend at the new family-owned business that just opened.

"We certainly will see damped enthusiasm for purchases. There will be a much more thoughtful perspective on whether small, medium-sized businesses are going to expand," says Tolomer.

On Thursday, the U.S. Bureau of Economic Analysis will release the country's Gross Domestic Product number for the second quarter of 2022. Many experts believe the U.S. will see a drop for the second straight time which could signal a recession.

Some say extremely low unemployment may be enough to prop the economy up for now while others argue we're already in a recession or one is around the corner.