WASHINGTON - (05/04/05) -- The Federal Reserve raisedshort-term interest rates again Tuesday by 25 basis points to 3%,in its continued efforts to dampen inflation and economic growth.But the continued rise in short-term rates have had little effectson long-term rates, raising concerns about a continued squeeze oncredit unions and other financial intermediaries. "The risk now isthe inability (of the Fed) to talk up long-term rates," NAFCUeconomist Jeff Taylor, told The Credit Union Journal. He worriedabout the phenomenon known as an inverted yield curve--when shortterm rates are higher than long-term rates. That discourageslonger-term lending and investments because short-term lending andinvesting are more profitable, putting increased pressure on creditunions and other intermediaries. Meantime, Tuesday's Fedaction--the eighth 25 bp hike in the past nine months--is expectedto immediately push up rates for short-term credit union loans likethose for cars and home equity lines of credit, which have risen anaverage of 40 bps and 135 bps, respectively, since the Fed startedits recent rate increasing last June.
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House Republicans overcame internal divisions to narrowly pass President Trump's tax and spending package Thursday afternoon. The measure would cut the Consumer Financial Protection Bureau's funding level, among other provisions.
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A new partnership with Google Cloud will let the Spanish bank offer Gemini to all staff after a successful ChatGPT deployment.
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Atlanta-based CoastalSouth's initial public offering prices at $21.50 a share; Valley National Bancorp announces Lyndsey Sloan will succeed Gary Michael as general counsel; Webster Financial Corporation taps a new chief risk officer and appoints a new board member; and more in this week's banking news roundup.
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Capital One closed the deal to buy the credit card provider in May and as part of the review process, decided to exit its home equity lending business.
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In a rare move for a credit union, the Seattle institution has snapped up the 13-member team that created EarnUp's AI Advisor product.
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The Federal Reserve has banned a Wyoming bank employee from the banking industry for embezzling more than $30,000 from a charity.
July 3