Correspondent Blog

Fed Speak and Another Inflation Number This Week After the FOMC meeting last week—and its two hikes in 2023 scenario—put some volatility into markets, investors will be eager to hear more from Fed officials this week to gain additional color on their thinking. With nine Fed officials set to talk this week we will get…

Did the Fed Just Blink on Inflation? In a stare down contest did the Fed just blink at higher inflation and hence take the edge off their new policy framework? That seems to be the takeaway from all that they delivered on Wednesday afternoon.  Recall the new policy framework they unveiled at Jackson Hole last…

It’s FOMC Day and we delve into more detail below what we think comes of this meeting. This is one of those quarterly affairs where the Fed updates its economic and rate projections and those often provide more insight than the carefully-crafted statement and heavily-scripted post-meeting press conference. Suffice it to say, we think Chair…

If you ever wanted to know the most popular strategic planning initiative for a bank over the last three years, it is this one – generate more non-interest income. An estimated 30% of banks have this as their focus. The funny part is that despite this being a major conversation and the source of many…

It was back in 2014 when researchers at DeepMind directed their nascent artificial intelligence application to the game Breakout. Instead of programming DeepMind on how to play the game, the researchers programmed DeepMind to learn about learning to play the game. That is a meta-level that isn’t normally programmed, but the result of that effort,…

FOMC Meeting Headlines the Week The FOMC Meeting on Wednesday will be less about what is said, although any taper talk will get headlines, and more about the updated rate and economic forecasts. While there had been some speculation that the beginnings of taper talk might occur at this meeting it’s not likely with the…

When Is Hot Not So Hot? A hotter-than-expected May CPI came and went and Treasuries sold off, right? Well, no. After a little early knee-jerk selling, buyers quickly came to the fore and Treasuries ended the day with lower yields, even in the face of new 30-year bond supply. What’s going on, you say? Well,…

Will May CPI Change the “Transitory” Narrative? The question for this week is what would it take for tomorrow’s May CPI numbers to change the Fed’s transitory narrative as it pertains to price increases? Expectations are for a solid increase of 0.4% overall and 0.5% core month-over-month, and while that is surely high by historical…

Last April, we published a piece (HERE) about how the pandemic has shifted traffic patterns to permanently impact branch strategy. We discussed how a combination of a faster shift to mobile banking during the pandemic and fewer trips to work, school, transportation hubs, and retail outlets had changed branch placement.  Traffic to urban core branches,…

May CPI and Aftermath of the Jobs Report With the Fed going into radio silence ahead of the FOMC meeting next week, that leaves investors more time to pick over the May jobs report and any implications that can be made.  While it missed expectations, it also was better than the mediocre April numbers. That…

For decades, community banks have structured term loans as 5-year fixed-rate facilities.  In the last six months, the percentage of 5-year fixed-rate loans at community banks has increased by approximately 25%, but this same bucket has held steady at larger banks (those over $25B in assets).  We believe that now is the right time for…

May Employment Report Misses Expectations But Better Than April The May Employment Report missed expectations of 675 thousand new jobs with 559 thousand jobs created. Even with the slight miss, the May results are more in line with the upbeat gains from March rather than the mediocre 278 thousand pick-up in April. The average over…