Term Few Will Want To Hear: Prolonged Malaise
MADISON, Wis. – CUNA Mutual’s chief economist, Dave Colby, has a new name for his economic forecast: “protracted malaise.”
That forecast is manifested in the June Trends Report issued by CUNA Mutual. “Results through June show tepid savings and asset growth. Deposit dollars continue to flow into low-yielding liquid accounts,” wrote Colby. “The debt ceiling, the downgrade and the equity market turmoil could trigger a flight to safety in the near term. Prepare to manage deposit rates and inflows carefully in the coming months. Total assets finished June at $963 billion, up 4.2% for the year.”
In his analysis, Colby found some good news, but it is tempered by other market conditions.
“Rarely are CUs presented with back-to-back opportunities to help members manage their finances,” said Colby. “Refinancing loans at new lower rates will provide much needed cash flow for member households or help lower overall debt levels. Despite very unattractive yields, CUs also can provide net saver member households with wealth preservation in these extremely uncertain times.