Rates Start To Rise At CUs
MADISON, Wis. - (09/043/04) -- Credit unions began lifting therates they pay on shares in July, after the Federal Reserve beganits move to lift short-term rates. Data compiled by CUNA shows that35% of credit unions in its monthly FAST survey of 475 creditunions raised rates on one-year certificates in July, an unusuallylarge 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% raisedunsecured loan rates; and 4% lifted credit card rates.Interestingly enough, almost as many credit unions lowered theirshort-term loan rates, with 11% cutting new car rates; 7% loweringunsecured loan rates; and 3% reducing rates on credit card loans.The Fed enacted the first of two 25 basis point increases in itsovernight FedFunds target rate on June 30, prompting manydepositors to start raising their rates. The Fed followed lastmonth with another 25 bp raise in the FedFunds target rate, whichis now 1.50%.