NEW YORK – The Fed’s raising of long-term interest rates threatens sales of homes, cars and other expensive items that to-date have helped drive the U.S. economic recovery, the Wall Street Journal reports.

While economists maintain the increases aren’t likely to derail the recovery, they are high enough to raise worries among consumers and corporate executives.

"It causes me to be a bit more cautious," said Ron DeFeo, the chief executive of Connecticut-based Terex Corp., a manufacturer of heavy building machines. "I am hesitant because I really don't believe the U.S. economy is in a strong growth mode."

The U.S. economy grew at a 1.8% annualized rate in the first quarter this year, following a stagnant fourth quarter of 2012, the Commerce Department said earlier this week. A large contributor to the growth was spending on big-ticket consumer goods and home construction, both sensitive to interest rates. Without those two sectors, the economic growth was just 0.9% in the first quarter and negative in the fourth quarter of 2012.

While auto dealers and economists aren’t screaming danger just yet, they are expressing heightened concerns.

"As we speak today the car market is generally healthy, but it's very fragile all in the same breath," said William C. Fox, who owns four new and used car dealerships in upstate New York. "We feel it very quickly if something goes wrong."

"It's too early to form a judgment about the degree of the backup," Dallas Fed President Richard Fisher said in an interview Wednesday. "Markets are still sorting through the signals they are receiving."

Economists at Goldman Sachs have predicted that the interest rate increases and lower stock prices could cut 0.4 percentage point off U.S. growth in the next year. The Mortgage Bankers Association said Wednesday that applications to refinance mortgages decreased last week to their lowest level since November 2011. 

Taking a more optimistic view, Frederick Cooper, senior vice president of finance, international development and investor relations at Toll Brothers Inc. said the rising rates reflect a stronger economy and an improving job market. 

"Those are the really compelling things that benefit housing, and I think those far outweigh the interest rate impact, given where interest rates are today," he said.