Deposit Funding Compass Week of November 2, 2023

Federal Reserve Chair Jerome Powell hinted the US central bank may now be finished with the most aggressive tightening cycle in four decades after it held off on raising interest rates for a second consecutive policy meeting. Federal Open Market Committee left its benchmark rate unchanged Wednesday in a range of 5.25% to 5.5%. Officials signaled in a post-meeting statement that a recent rise in longer-term Treasury yields reduces the impetus to hike again, though they left the door open to another increase. The 10-year US Treasury yield tumbled below 4.75% for the first time in two weeks, extending moves initially triggered in the morning by the Treasury Department’s plans to slow the pace of increase in its long-term debt sales.
CD issuance has been tempered to start November, and this week’s rates reflect the benefit of that wait and see approach. Though pricing isn’t as dynamic as other asset classes we feel with a 2wk+ settle this more aggressive run of levels should begin to gain traction as supply is light. Money center banks aren’t moving off their pre-rally rates, but demand should pick up the slack even with spreads widening. Please see today’s funding opportunities.

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Deposit Funding Compass Week of January 18, 2024

Bond market participants and prognosticators are beginning to reassess their expectations for rate cuts in 2024. This morning Federal Reserve Bank of Atlanta President Raphael Bostic urged policymakers to proceed cautiously toward interest-rate cuts given the potential economic impact of unpredictable events ranging from elections at home to conflicts around the world.  Fed officials have pushed back…
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Deposit Funding Compass Week of January 11, 2024

Americans paid more for housing and driving in December as inflation increased and the CPI registered 3.4%. On an annual basis, the so-called core measure increased 3.9%.  Early reactions show the rates market interpreting this as a challenge the Federal Reserve will cut interest rates as imminently as previously thought. The odds for a cut at the Jan…
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CU Funding Compass Week of January 5, 2024

Juxtapose data points have somewhat confused traders this morning as a sharp sell off in rates following the non-farm payroll report has been tapered by a dismal ISM release. US job growth picked up in December(+216k) and wage gains exceeded expectations, diminishing prospects for an imminent Federal Reserve interest-rate cut initially. Expectations for a March cut were…
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Deposit Funding Compass Week of January 5, 2024

Juxtapose data points have somewhat confused traders this morning as a sharp sell off in rates following the non-farm payroll report has been tapered by a dismal ISM release. US job growth picked up in December(+216k) and wage gains exceeded expectations, diminishing prospects for an imminent Federal Reserve interest-rate cut initially. Expectations for a March cut were…
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Deposit Funding Compass Week of December 28, 2023

We’d like to highlight some funding specials that are somewhat speculative given they are 10-20 BPS lower than what is currently outstanding on the same terms, however, with a lack of product overall and continued strong demand, we feel that we can move appreciable volume at the stated rates. We would be willing to firm…
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CU Funding Compass Week of December 28, 2023

We’d like to highlight some funding specials that are somewhat speculative given they are 10-20 BPS lower than what is currently outstanding on the same terms, however, with a lack of product overall and continued strong demand, we feel that we can move appreciable volume at the stated rates. We would be willing to firm…
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CU Funding Compass Week of December 20, 2023

Rates are down considerably week over week and at their lowest levels since mid-summer. Share Certificate issuance had a moderate uptick late last week/early this week but with limited days remaining in the month and two holidays to account for it looks prudent to begin focusing on 2024 business. Please see our current funding opportunities…
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Deposit Funding Compass Week of December 20, 2023

Rates are down considerably week over week and at their lowest levels since mid-summer.  CD issuance had a moderate uptick late last week/early this week but with limited days remaining in the month and two holidays to account for it looks prudent to begin focusing on 2024 business. Please see our current funding opportunities the…
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Deposit Funding Compass Week of December 14, 2023

Market Commentary: The FOMC left its policy rate unchanged yesterday at 5.25%-5.50%, as expected, but the totality of Fed communication was dovish enough to spur a significant bond rally throughout the afternoon. 2s fell almost 30bp by the end of trading, 5s fell below 4.00% for the first time since July, and 10s fell to…
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CU Funding Compass Week of December 14, 2023

Market Commentary: The FOMC left its policy rate unchanged yesterday at 5.25%-5.50%, as expected, but the totality of Fed communication was dovish enough to spur a significant bond rally throughout the afternoon. 2s fell almost 30bp by the end of trading, 5s fell below 4.00% for the first time since July, and 10s fell to…
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