Data Indicate CUs Began Lifting Their Rates In July
Credit unions began lifting the rates they pay on shares in July, after the Federal Reserve began its move to lift short-term rates. Data compiled by CUNA shows that 35% of credit unions in its monthly FAST survey of 475 credit unions raised rates on one-year certificates in July, an unusually large amount; while 17% lifted their money market rates; and 4% raised the rates they pay on regular shares. On the loan side, 14% of credit unions raised their rates on new auto loans; 7% raised unsecured loan rates; and 4% lifted credit card rates.
Interestingly enough, almost as many CUs lowered their short-term loan rates, with 11% cutting new car rates; 7% lowering unsecured loan rates; and 3% reducing rates on credit card loans.
The Fed enacted the first of two 25 basis point increases in its overnight FedFunds target rate on June 30, prompting many depositors to start raising their rates. The Fed followed last month with another 25 BP raise in the FedFunds target rate, which is now 1.50%.