Bank Deals Blog: Deposits Education and Strategies

At the conclusion of the FOMC meeting this afternoon, the Fed announced a 50-bp rate hike. After four 75-bp rate hikes at the last four meetings, the Fed decided to downshift to a 50-bp rate hike. This was highly anticipated after the recent lower-than-expected inflation reports.

The target federal funds rate is now 4.25%-4.50%. This is now 200 bps above the peak of the last rate hiking cycle (2015-2018). We haven’t seen federal funds rates this high since late 2007. The last time the Fed increased the target federal funds rate...

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At the conclusion of the FOMC meeting, the Fed announced its fourth straight 75-bp rate hike. The target federal funds rate is now 3.75%-4.00%. This is now far above the peak of the last rate hiking cycle (2015-2018). We haven’t seen federal funds rates this high since early 2008.

Below are excerpts from today’s FOMC Statement that covers the rate decision:

In the rate decision paragraph, there are hints that the Fed is preparing to slow the pace of the rate hikes. The excerpt below is what was added from the previous...

At the conclusion of the FOMC meeting, the Fed announced its third straight 75-bp rate hike. The target federal funds rate is now 3.00%-3.25%. This is now far above the peak of the last rate hiking cycle (2015-2018). We haven’t seen federal funds rates this high since early 2008.

Today’s FOMC Statement is actually very close to the July Statement. Below are excerpts from today’s FOMC policy statement that covers the rate decision:

All voting members voted in favor of today’s policy action.

In addition to the statement, the Fed released its quarterly...

At the conclusion of the FOMC meeting, the Fed announced its second straight 75-bp rate hike. The target federal funds rate is now 2.25%-2.50%, which is the target range that had existed at the peak of the last rate hiking cycle in December 2018. It took three years of rate hikes from 2015 to 2018 to equal the rate hikes from the last four and a half months. Below are excerpts from today’s FOMC policy statement that covers the rate decision:

For the full details, please refer to today’s FOMC Statement.

Update 10:30pm, 6/15/22: Reviews of the Fed Chair press conference and the Summary of Economic Projections (SEP) were added. Also, sections on Treasury yields, deposit rates and strategies for savers were added.

The Fed announced its first 75-bp rate hike since November 1994 at the conclusion of its meeting today. The target federal funds rate is now 1.50%-1.75%, which is the target range that had existed before the start of the pandemic. If the Fed hikes 75 bps again at its July 26-27 meeting, we’ll be back at the peak...

The Fed announced its first 50-bp rate hike since 2000 at the conclusion of its meeting today. In addition, the FOMC statement suggested that additional 50-bp rate hikes will be likely. The big news came from the post-meeting press conference when Fed Chair Powell downplayed the possibility of a 75-bp rate hike. That was interpreted by the markets as a dovish move resulting in a rally in the stock market. This didn’t help ease concerns that the Fed isn’t up to the job of controlling inflation.

Before reviewing the Fed Chair’s...

After two years of near zero rates, the Fed has announced liftoff with a 25-bp rate hike. In addition, the FOMC statement suggested that rate hikes are likely at each of the remaining six meetings this year. In addition to rate hikes, the Fed addressed its balance sheet. It didn’t announce a reduction of its balance sheet at this meeting, but it did state that the reduction would begin “at a coming meeting.” The following is an excerpt from today’s FOMC statement that describes these policy actions:

The Fed delivered today what was widely expected in paving the way for rate liftoff at its March 15-16 meeting. The language from the FOMC statement and from Fed Chair Powell’s press conference made it pretty clear that, barring any surprises, a rate hike in March should be expected. The Fed also met expectations on tapering by announcing one final round of asset purchases in February which will result in taper completion by March. The following excerpt from today’s FOMC statement is the formal announcement of these plans:

Unlike banks, credit unions have fields of membership (FOMs). You must be in the FOM to be eligible to join the credit union. Many FOMs include a geographic area. If you live or work in that area, you are part of the FOM and eligible to join the credit union. Also, many credit union FOMs include Select Employee Groups (SEGs). If you work for one of these employers, you are part of the FOM and eligible to join. It’s also very common for credit union FOMs to include family members.

Family...