Economic news

The central bank also noted that the banking system is sound but faces several challenges. The report precedes Federal Reserve Chair Jerome Powell's upcoming appearances on Capitol Hill.

Federal Reserve Chair Jerome Powell says crushing inflation is the most important thing the Fed can do to reduce costs in the housing market. Some economists and policy specialists say higher rates are not the only tool at its disposal.

The Federal Reserve chair said a rate cut would not solve the underlying issues driving up shelter costs, even as housing becomes a disproportionate driver of inflation.

Late payments, which have been on a steady rise since 2021, are now climbing at a slower rate or even declining at some major card issuers. Risks remain, but there's 'reason to be cautiously optimistic," one analyst said.

Though hard times put a dent in profitability, asset quality and net interest margin continued to shine among the list of the best performing publicly traded community banks.

The rise of ecommerce and vertical software-as-a-service platforms are prime opportunities for large banks to sell payment processing, card issuance and other banking capabilities.

In a speech, the Federal Reserve governor said she would have liked to see the Federal Open Market Committee move more quickly to reduce its holdings. The central bank is poised to begin slowing the pace of balance sheet runoff this week.

These three payment firms are working to grow revenue by pivoting to new markets and technologies, all while waiting for a turnaround in the industry.

Large banks, particularly those with over $100 billion in assets, see increasing supervisory shortcomings related to interest rate and liquidity risks, governance and risk control issues, and cite cybersecurity, CRE values, and remote work trends as potential hazards in the future.

During this week's Federal Open Market Committee meeting, officials voted to lower the cap on the amount of Treasury securities that can roll off the central bank's books each month from $60 billion to $25 billion.

Banks and other financial market participants have been keyed into the central bank's communications around monetary policy expectations. But in an unpredictable economy, the guidance doesn't always hit the mark.

Recent economic data have shown inflation stubbornly above the Fed's 2% target, putting rate cuts in jeopardy. Lauren Saidel-Baker, an economist with ITR Economics, parses the FOMC meeting, Chair Powell's press conference and takes a look at future policy.

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.

The Cleveland-based bank is projecting steady growth in net interest income even as credit losses remain manageable. But Chairman and CEO Chris Gorman also said that he thinks a recession is likely.

The banking giant nonetheless saw strong growth in net new assets in the first quarter and a 14% jump in returns from asset management fees.

The Federal Reserve, historically a secretive and isolated institution, has made a concerted effort to explain itself to and be understood by the public since 2008. But try as it might, the central bank is still viewed by many as an enigma, if not an enemy.

A federal judge's ruling in the Custodia lawsuit settles — for now — the question of whether the Federal Reserve has the discretion to grant or deny a bank access to its payment settlement system. But to keep it, the Fed needs to articulate the danger it's protecting against.

D.A. Davidson Director of Wealth Management Research James Ragan will review and analyze the March Federal Open Market Committee meeting.

Federal Reserve Chair Jerome Powell said at the Federal Open Market Committee press conference Wednesday that a slower pace of reduction could help the central bank avoid shrinking its holdings further without disrupting the banking system.

Federal Reserve Governor Christopher Waller said he'd like to see the central bank's holdings of mortgage-backed securities go to zero.