![]() But that would increase the stress on the banks. Or the Fed could stay the course on fighting inflation. But that would increase the risk of a renewed outburst of inflation, which the Fed is just beginning to bring under control. Chair Jerome Powell and the other rate setters could ease the banking crisis by reversing course and cutting interest rates. ![]() The Federal Reserve - which announces its next rate decision on Wednesday - is in a bind. And the Federal Reserve is still putting pressure on the banks by raising interest rates, which tempts depositors to take out their money and put it in higher-yielding money market mutual funds. But other regional banks are still bleeding deposits. True, regulators seized First Republic Bank early on Monday and sold it to JPMorgan Chase, the nation’s biggest bank. ![]()
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