WASHINGTON - (05/03/05) -- The Federal Reserve is widelyexpected to boost short-term rates again when it meets Tuesday,maintaining a course aimed at damping inflation and temperingeconomic growth. Jeff Taylor, a NAFCU economist, said inflationcontinues to rise, especially for the Fed's core personalconsumption index, which increased to an annualized 1.75%, and 2.3%for the last three months. "That's considered at the upper level oftheir comfort level," said Taylor, who expects the Fed to addanother 25 basis points to its target for overnight funds,currently at 2.75%. The Fed has raised the short-term rate sixtimes over the past nine months from a five-decade low of just 1%.The rise has proved profitable to credit unions, boosting intereston an estimated $30 billion of credit union funds invested in theovernight market by as much as $60 million annualized over thatperiod.
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At a time of mild or nonexistent loan growth, middle-market borrowers in the Lone Star State are providing a boost to Fifth Third Bancorp and Huntington Bancshares.
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New details have emerged about the negotiations that culminated in Capital One's blockbuster $35 billion agreement to acquire Discover. At one point last December, the two parties broke off discussions, according to a securities filing.
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According to the Federal Reserve Board's latest financial stability report, persistent inflation and policy uncertainty are the primary worries for banks. Survey respondents expressed heightened anxiety over murky policy outlooks due to geopolitical turmoil and rapidly approaching domestic elections.
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The Alabama regional lender says it expects expenses to taper off this year and anticipates challenged loans will gradually rise to historically average levels.
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Truist Financial's top executive leadership team announces departures; First Horizon's chief credit officer is retiring; Ferry teams with Highnote to roll out a new Visa-branded payroll card; and more in the weekly banking news roundup.
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The Dallas-based regional bank tapped a client for its co-pilot capabilities, where employees can message a bot instead of a human to get tech assistance.
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